Legalities and Customs Duty
While importing may work well in most markets, it is difficult in Brazil due to high tariffs and taxes.
Many exporting countries, such as the USA and Germany, are not parties to a bilateral free trade agreement with Brazil. As a result imports from these countries bear tariffs and taxes which can range from 0 to 35 percent on the CIF value (i.e., cost, insurance, and freight value). The bound rate that Brazil can levy on imports under World Trade Organization rules is 31.4 percent. Since tariffs can be changed by the government at any time, importers are subject to risk and uncertainty.
These are the taxes that are incurred for imports into Brazil:
• Imposto de Importação – II (Import Tariff)
• Imposto sobre Produtos Industrializados - IPI (Industrial Products Tax)
• Contribuição para o PIS/PASEP E COFINS (Contributions to the Social System)
• Adicional de Frete para a Renovação da Marinha Mercante – AFRMM (Tax for Goods Shipped by Sea)
• CIDE-Combustíveis (Tax on Combustibles)
• Imposto sobre Circulação de Mercadorias e Serviços - ICMS (Value-Added Tax)
• Taxa de Utilização do Siscomex (Fee for Usage of the Foreign Commerce Computer System)
The result can be a 100 percent increase in the cost of the imported products. Furthermore, importers must consider the following:
Importers must first register with the Brazilian Foreign Trade Secretariat (SECEX) and be registered with the Registry of Importers. Finally, importers must determine whether an import license is required to import a particular product. This can take up to a year.