Business

Bolsonaro’s manufactured goods tax cut fails to please

President Jair Bolsonaro sees cutting Brazil's IPI manufactured goods tax as a quick way to generate good economic press. However, analysts say the cut will have no benefit for consumers, and the industry was left wanting more

taxes Bolsonaro's manufactured goods tax cut fails to please
Placed in São Paulo’s city center, the “Tax-o-meter” measures how much Brazilians have paid in taxes in a given year. Photo: Alf Ribeiro/Shutterstock

With less than six months to go before President Jair Bolsonaro puts his electoral popularity to the test in the hope of securing a second term, his government has thrown in the towel in its quest to approve any sweeping constitutional reforms. Instead, the head of state is focusing on smaller populist measures that do not require congressional approval and which could provide momentary jolts to the economy as we approach the election. At the center of this strategy is Brazil’s IPI manufactured goods tax, rates of which the domestic industry is desperate to see fall.

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