Brazil Tax Regulations

LinkedIn Twitter Facebook

 

Author: Alannes Moura, Product Manager for Brazil, Avalara

As any company that has tried to conduct cross-border commerce with Brazil well knows, doing business in this country is challenging yet tempting, since it’s the largest economy in both South America and Latin America.

The measure under consideration is a good example of Brazil's myriad, complex tax regulations – most of which must be managed manually by businesses. The proposed restrictions are intended to appease Brazilian eCommerce merchants’ complaints that it is "too easy" for Brazilians to purchase goods from foreign ecommerce sites, and to “level the playing field” vs. large international eCommerce merchants.

 

The government is considering lowering the current $50 exemption to a symbolic amount, although what’s not mentioned yet (as far as we know) are the actual changes in rates. Note that there is precedent for this action: the Brazilian supreme court has upheld the IPI taxation of imports on the grounds of the "isonomy principle" that guarantees equal taxation for national and foreign manufacturers.

 

Naturally, the next question is, how quickly could this law become enacted? Not immediately, is the short answer.

 

The fastest way for Brazil to approve this change would be through a presidential executive order, which would still take a couple of months to go into effect, as the agencies must issue regulations regarding the changes. Moreover, any tax-rate change is subject to a 90-day adaptation period. Since this is being discussed at cabinet level, we will be paying close attention to see the outcome of these discussions.

 

Tax Regulations Brazil

 

Unlike the IPI taxation ruling (which affected comparatively fewer businesses), this action would likely be very unpopular with Brazilian consumers. Many consumer disputes have already arisen with both the Brazilian post office and Brazilian customs. At present, import taxes are collected by the carrier (in most cases, the Brazilian post office) prior to delivering the goods to the buyer.

 

The Brazilian post office has already been known to overlook the $50 exemption limit and attempt to collect taxes on shipments of lesser value. In addition, Brazilian customs arbitrates the value of goods, often ignoring invoices included in the shipment, which also causes consumer disputes. Ecommerce merchants – large and small – should continue to pay attention to this issue, as events unfold in the weeks and months to come, as it may indeed change the commercial landscape.

 

LinkedIn Twitter Facebook

5 tips for breaking into online retail in France

5 tips for breaking into online retail in France

France boasts being the 5th largest eCommerce market in the world and with an expectation to exceed €80 billion turnover in 2017, for those looking to enter this thriving online market here are five tips that could help you to break into the French online retail space.
Interview with Melanie Smallwood, International Buying Director at Global Fashion Group

Interview with Melanie Smallwood, International Buying Director at Global Fashion Group

eCommerce Worldwide Cross-Border Summit 2017 - Ahead of our annual event on 24th May, we interview Melanie Smallwood, International Buying Director at Global Fashion Group, to learn from her experience and knowledge in cross-border trading around the world.
Interview with Gregor McMillan, Business Development, China at The Hut Group

Interview with Gregor McMillan, Business Development, China at The Hut Group

eCommerce Worldwide Cross-Border Summit 2017 - Ahead of our annual event on 24th May, we interview Gregor McMillan, Business Development, China at The Hut Group, to learn from his experience and knowledge in cross-border trading into China.
Interview with Michael Truluck, CEO at La Redoute

Interview with Michael Truluck, CEO at La Redoute

eCommerce Worldwide Cross-Border Summit 2017 - Ahead of our annual event on 24th May, we interview Michael Truluck, CEO at La Redoute, to learn from his experience and knowledge in cross-border trading.
The latest view on eCommerce in Germany

The latest view on eCommerce in Germany

There are many benefits to entering the German eCommerce market - it’s the 3rd largest online market in Europe and has a very high internet penetration rate, but what other staistics do you need to know before entering this lucrative country?
How to use colour in cross-border online retail

How to use colour in cross-border online retail

Did you know colour can be an important driver of eCommerce sales? Research suggests 85% of buyers make their purchasing decision based on colour so getting it wrong could be a fundamental disaster for any online business. So what is the right colour to use?
Interview with Richard Longhurst, Co-Founder and Director at Lovehoney

Interview with Richard Longhurst, Co-Founder and Director at Lovehoney

eCommerce Worldwide Cross-Border Summit 2017 - Ahead of our annual event on 24th May, we interview Richard Longhurst, Co-Founder and Director at Lovehoney, to learn from his experience and knowledge in cross-border trading.
Building an eCommerce fraud prevention strategy for Germany

Building an eCommerce fraud prevention strategy for Germany

Being the world’s fifth largest eCommerce market, Germany has become an exceptionally popular destination for online merchants looking to sell their goods and services. However, retailers should still be aware of the high levels of fraud to do with their number one payment method. Therefore, what do you need to know about building an eCommerce fraud prevention strategy for Germany?
Interview with Kai Li, Vice President of International at Revolve

Interview with Kai Li, Vice President of International at Revolve

eCommerce Worldwide Cross-Border Summit 2017 - Ahead of our annual event on 24th May, we interview Kai Li, Vice President of International at Revolve Clothing, to learn from his experience and knowledge in cross-border trading.
How does device usage differ in France, Germany, and the UK?

How does device usage differ in France, Germany, and the UK?

It is well known that the use of smartphones and tablets has grown rapidly but which device dominates the traffic and at what time of day across France, Germany and UK? And how does device usage differ between these Countries?

Contact Us

eCommerce Worldwide
2 Ching Court
49-53 Monmouth St
London
WC2H 9EY

Tel: 0203 696 0980
2016© eCommerce Worldwide

Keep In Touch

powered by Affino

About eCommerce Worldwide

eCommerce Worldwide provides online retailers with all the information, and resources, they need to develop cross-border strategies for entering new markets around the world
Read More