Government announces discount from 1.5% to 10.8% for new cars

The federal government announced discounts for the acquisition of new cars in Brazil. The measure will be possible with the reduction of the rates of the Tax on Industrialized Products (IPI) and of the Social Integration Program and Contribution for the Financing of Social Security (PIS/Cofins) for the automotive industry.

The discounts that will affect the value of the vehicles will range from 1.5% to 10.8%, according to criteria of price, energy efficiency and industrial density in the country. The measure applies to cars of up to R$ 120,000.

However, there is still no definition of what the rate reduction level will be and how the government will compensate the benefit. The measure is under discussion at the Ministry of Finance, which will have 15 days to present the parameters that will be used in the edition of a decree (to reduce the IPI) and a provisional measure (MP) (to reduce PIS/Confins) that will be forwarded for approval by the National Congress.

The information was provided by the Vice President of the Republic and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin, after a meeting between President Luiz Inácio Lula da Silva and representatives of workers’ organizations and manufacturers in the automotive sector, at the Planalto Palace, in Brasilia.

At the meeting, Lula and Alckmin discussed short-term measures to expand the population’s access to new cars and leverage the production chain linked to the Brazilian automotive sector, with a view to renewing the fleet in the country. According to the vice-president, the benefits will be temporary, for this moment of idleness in the industry.

According to the National Association of Automotive Vehicle Manufacturers (Anfavea), the final consumer price may drop to less than R$60,000, depending on the policy of each automaker. Currently, it is not possible to buy a popular car for less than R$ 68 thousand. The president of Anfavea, Márcio de Lima Leite, explained that it is important that the benefit is for at least 12 months, for better planning and investments in the industry.

According to Leite, the discounts will be immediate after the publication of the MP and the decree and will even affect vehicles that are already in the automakers’ yards.

Criteria

Alckmin explained that there will be a methodology for applying the discounts, which will take into account three criteria. The first is the social issue, the price of the car. “Today the cheapest car costs almost R$70,000. So we want to reduce this amount, ”he said. “The smaller the car, the more affordable it is, the greater the IPI and PIS/Cofins discount. So, the first item is social, you serve this population that needs it the most.”

The second criterion is energy efficiency, “who pollutes less”. “So, you reward and encourage energy efficiency, cars that pollute less, with less CO2 emissions (carbon dioxide, greenhouse gases)”, he said.

For Márcio de Lima Leite, from Anfavea, in general, with fleet renewal, there will already be environmental gains for the country, since a used vehicle can emit 23 times more greenhouse gases than a new car.

And, finally, the criterion of industrial density. “The whole world today seeks to strengthen its industry. So, if I have an industry (in) where 50% of the car is parts (manufactured in Brazil) and made in Brazil and the other is 90%, that will be taken into account”, explained Alckmin.

According to the vice-president, Brazil has been undergoing a process of de-industrialization and, therefore, the government must make a recovery effort to increase competitiveness and reduce the Brazil Cost. “It’s what we call neo-industrialization”, these.

Custo Brasil is a term that describes the set of structural, bureaucratic and economic difficulties that make new investments more expensive and compromise companies and worsen the business environment in the country. That is, it is the additional expense that Brazilian companies have to disburse to produce in Brazil, compared to the countries of the Organization for Economic Cooperation and Development (OECD).

In a study carried out by the federal government in partnership with the Movimento Brasil Competitivo, in 2019, the Brazil Cost was estimated at R$ 1.5 trillion, or 22% of the Gross Domestic Product (GDP, sum of all goods and services produced in the country ).

Among other measures, the government focus on tax reformunder discussion in the National Congress, to reduce this cost.

industry crisis

According to Márcio de Lima Leite, the automotive sector works today with 50% of its installed capacity “It is one of the lowest numbers and one of the worst months in the automotive industry, a market that represents 20% of the industrial GDP.

Vehicle production increased by 8% in the first quarter of the year compared to the same period in 2022. balance disclosed in April by Anfavea, 496.1 thousand units were manufactured in the first three months of this year.

Despite the number representing a high compared to last year, at the time, Leite recalled that the first quarter of 2022 was the worst result for the automobile industry since 2004. “We are repeating in 2023 the worst quarter since 2004”, he said, when comparing production data in 2022 and 2023.

Today, the president of Anfavea highlighted that, this year, there were 14 moments of plant shutdown, due to the lack of semiconductors (an important input for the sector) and the supply problem that still comes from the crisis caused by the covid-19 pandemic. .

“Right now, automakers have reaffirmed their belief in Brazil, and we are investing BRL 50 billion, one of the biggest investment cycles in the automotive industry. We believe in competitiveness and we are doing work, together with the government, for recovery, for the market to warm up”, he said, in conversation with journalists, after the meeting at the Planalto Palace, also citing the resumption of job offers. in the sector.

export credit

Another measure that should to benefit the automotive sector was announced today by the president of the National Bank for Economic and Social Development (BNDES), Aloizio Mercadante. The bank will open a credit line of R$ 2 billion just for export products, financed in dollars.

Another R$ 2 billion will be available for exporting companies to invest in the modernization of their production line.

“This is an extremely urgent and relevant measure that the sector has seen with good eyes”, said the president of Anfavea.

Enlarged text at 2:45 pm