Agreement Reached to Advance Measure Ending Import Tax on Low Value Goods

An agreement has been reached to move forward with a provisional measure (MP) that would end the 20 percent import tax on international purchases of up to 50 US dollars, commonly known as the blusinhas tax. The vote is expected to take place in the mixed commission and the plenaries of both the Chamber of Deputies and the Senate on Wednesday, September 2. The measure must be approved by September 8 to avoid expiring, which would result in the tax being reinstated shortly before the elections.

The agreement focuses on the periodic evaluation of the measure's impacts. The first analysis will occur after three months of implementation, followed by evaluations every six months by the Ministry of Finance and an annual review by Congress. This compromise addresses demands from the national productive sector for tax and regulatory symmetry, including assessments of product quality and intellectual property.

Several points of contention were excluded from the final agreement. The requirement that beneficiaries use the state postal service, Correios, for deliveries will not be included, as will a proposed cashback system for consumers. These topics will instead be addressed during the broader tax reform. The agreement was finalized following discussions involving President Luiz Inácio Lula da Silva, the presidents of the Senate and Chamber, and other government and legislative leaders.

While both reports are from center leaning outlets, they emphasize different aspects of the process. One report focuses on the friction and lobbying efforts, highlighting how the national industry and retail sectors viewed the exemption as unfair competition and attempted to secure compensations, such as increasing taxes on sports betting. The other report frames the event as a successful diplomatic resolution, detailing the specific timeline and the regulatory criteria established to satisfy business interests.