NEWS IN ENGLISH – Government announces program to benefit industrial sector

allen — Wed, 04 Apr 2012 12:22:52 +0000

Wellton Máximo and Luciene Cruz Reporters Agência Brasil

Brasília – Yesterday, Tuesday, April 3, the government rolled out a program to help the industrial sector. The new measures, a total of more than 20 of them, ranging from the automobile sector to exports to cancer treatment, were presented as part of the ongoing Greater Brazil Plan (" Plano Brasil Maior").

According to the executive secretary at the Ministry of Finance, Nelson Barbosa, the program will cost the government R$60.4 billion this year, due to reduced tax revenue (“renúncia fiscal”), along with credit and grants to the National Treasury and official, state-run banks.

A total of R$45 billion, in the form of government bonds, will be transferred between now and the end of 2013 from the Treasury to the Brazilian Development Bank (“BNDES”) to be used in the government’s program to sustain investments (“Programa de Sustentação do Investimento - PSI”). This operation will not involve funds from the budget (“Orçamento Geral da União”), but will mean an increase in public debt.

Tax cuts will benefit industrial production (so-called “white goods” and building material, for example), and the government will also make significant reductions in payroll taxes in some 15 economic segments as part of the program objective of providing economic stimulus to the manufacturing (industrial) sector. Nelson Barbosa revealed that the tax cuts will reduce tax revenue (“renúncia fiscal”) by around R$3.1 billion in 2012.

According to the Ministry of Development, Industry and Foreign Trade, the following areas will all receive benefits from the program in one form or another: petroleum, gas and ship building (“petróleo, gás e naval”), autos (“automotiva”), healthcare services (“complexo da saúde”), defense, aeronautical and space industries (“defesa, aeronáutica e espacial”), information technology and communications/electric-electronic complex (“tecnologias da informação e comunicação/complexo eletroeletrônico”), capital goods (“bens de capital”), mining (“mineração”),metallurgic (“metalúrgica”), personal hygiene (“higiene pessoal”), perfume and cosmetics (“perfumaria e cosméticos”), chemical industry (“indústria química”), cellulose and paper (“celulose e papel”), renewable energy (“energias renováveis”), civil construction (“construção civil”), furniture (“movies”), footwear (“calçados”), garment industry and jewelry (“confecções e joias”), agribusiness (“agroindústria”), commerce (“comércio”), services (“services”) and logistical services (“serviços logísticos”).

The program will also include around R$4 billion in new government purchases (under the provisions of the decree, to stimulate domestic production, Brasilia will be allowed to buy Brazilian-made goods that are up to 25% more expensive than similar imported items).

Finally, the export sector will have access to reduced-interest loans totaling some R$2 billion.

Allen Bennett – translator/editor The News in English – content modified

Link - Pacote de ajuda à indústria custará R$ 60,4 bilhões para o governo em 2012

Link - Pacote para estimular a indústria “está dentro da realidade”, avalia CNI

(Daniel Lima, Yara Aquino, Luciana Lima and Pedro Peduzzi)

Nelso Barbosa

NEWS IN ENGLISH – Government announces program to benefit industrial sector