Brazil: Extension of excise tax (IPI), products imported under new Mercosur common nomenclature

New IPI rates are effective in Brazil beginning 1 May 2022.

Products imported under new Mercosur common nomenclature

Brazil’s federal government issued guidance (Decree 11.021/2022 (31 March 2022)) regarding an excise tax (imposto sobre produtos industrializados—IPI) and reflecting a new common external tariff structure of the Mercosur* common nomenclature (nomenclatura comum do Mercosul—NCM).

*Mercosur is a regional trade association with five member countries: Argentina, Brazil, Paraguay, Uruguay, and Venezuela. Seven countries have associate status: Suriname, Guyana, Colombia, Ecuador, Peru, Chile, and Bolivia.

The NCM provides a 2022 harmonized tariff system, effective 1 January 2022. Practically speaking, with the NCM, there was a new harmonized system, but there was no corresponding action regarding the IPI rates—thus, resulting in uncertainty.

To resolve the issue, the federal government issued guidance to clarify that new IPI rates are effective in Brazil beginning 1 May 2022.

Read an April 2022 report (Portuguese) prepared by the KPMG member firm in Brazil

 

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