Brazilian Congress Delays Vote on Import Tax Exemption for Small Purchases

The vote on a provisional measure (MP) to eliminate the 20 percent import tax on international purchases up to 50 US dollars, known as the blusinhas tax, has been postponed to Tuesday, November 1. The delay follows negotiations between the government of President Luiz Inácio Lula da Silva and members of Congress regarding two proposed changes to the measure. One proposal suggests making the tax exemption conditional on the use of the state owned postal service, Correios, for transport. This comes as Correios faces a severe financial crisis and requires new funding. The federal government has included a 6 billion reais transfer in the 2027 Budget to facilitate a 12 billion reais loan from public and private banks.

A second proposed change involves creating a periodic evaluation to monitor the impact of the tax exemption on national industry and retail. According to commission president Reginaldo Lopes and rapporteur Leila do Vôlei, the first evaluation would occur in three months, followed by semi annual reviews. Some legislators argue that the exemption should be temporary and only extended if it is proven that no harmful effects occurred for Brazilian businesses. This position is supported by companies operating within Brazil, while international e-commerce associations prefer that the government's original MP be maintained.

The MP was originally published in May to reverse a tax sanctioned in 2024 that had become unpopular. The measure must be approved by the commission and the plenaries of the Chamber and Senate by November 8, or it will expire and the 20 percent tax will return. The MP does not change the state level ICMS tax, which currently ranges from 17 to 20 percent.