20 percent cut to employers’ contributions. On April 3, President Dilma Rousseff presented a program to boost the industry – the Brazilian sector with the smallest growth, +0.3 percent in 2011 as opposed to 10.5 percent in 2010. This program provides for a series of fiscal measures designed to revive industrial production and exports. The program’s central provision is the 20 percent temporary reduction of employers’ contributions in manufacturing branches where a lot of people are employed (textile, clothing, plastic, furniture, car parts…). The government believes these sectors were the most badly affected by the loss of competitiveness coming from the increase in the national currency (real), from the increase in imports and from the international economic downturn. The financial losses caused by this measure, assessed at around BRL 7.2 billion (€3 billion) should be partially compensated by a tax (1-2 percent) on business income, except exports. Businesses selling abroad will get more tax exemptions. In addition, manufacturing firms, particularly in the auto industry, will get more favorable credit conditions.
ncy (real), from the increase in imports and from the international economic downturn. The financial losses caused by this measure, assessed at around BRL 7.2 billion (€3 billion) should be partially compensated by a tax (1-2 percent) on business income, except exports. Businesses selling abroad will get more tax exemptions. In addition, manufacturing firms, particularly in the auto industry, will get more favorable credit conditions.
Advantages for national production and exports. Together
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