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Brazil’s Vice President Geraldo Alckmin revealed new government measures on Sunday to provide companies with tax benefits, encouraging them to invest in new machinery and transportation. These measures are part of President Luiz Inacio Lula da Silva’s plan to “re-industrialize” Latin America’s largest economy, which saw industrial output drop by more than 18% below its 2011 high during the pandemic.
It’s part of the Lula administration’s plan to incentivize “green” projects, such as flex-fuel and electric vehicles, renewable power, and biofuels.
One of the measures is the establishment of the “Mover” program, which will provide a total of 3.5 billion reais ($721.34 million) in benefits next year, with the amount increasing to 4.1 billion in 2028. Alckmin stated that this will attract more investments to Brazil and address the issues of low productivity and investment.
The second measure, titled the “accelerated depreciation project,” suggests providing 3.4 billion reais in income tax benefits for companies to renew their machinery. According to Alckmin, this will stimulate the renewal of Brazil’s industry.
Additionally, import taxes would offset the revenue losses linked to the tax benefits, including those on electric vehicles brought from abroad.
