In a significant policy shift, Brazil's Chamber of Foreign Trade, known as Camex, has decided to increase the import tax to 25% on 11 specific iron and steel products. This change follows extensive analysis and comes as a response to requests from the National Union of Wire Drawing and Ferrous Metal Rolling Industries (Sicetel). The move aims to protect domestic producers from what they see as unfair competition from foreign imports.
Previously, these steel products were subject to import taxes ranging from 10.8% to 14%. The new definitive rate of 25% applies to any volume imported, eliminating the flexibility that existed under earlier quotas. This decision has significant implications for the Brazilian steel market, particularly in light of the competitive pressures from imported steel.
The increase in tariffs was not the only action taken by Camex. Alongside the steel products, the import duties on sodium chlorite, used for water treatment and various industrial processes, were raised from 9% to 10.8%. Additionally, tariffs on cables and optical fibers were increased to 35%, up from 11.2% and 9.6%, respectively. These changes reflect the government’s broader strategy to bolster domestic industries across various sectors.
The decision has sparked mixed reactions within the industry. Advocates argue that the higher tariffs will help level the playing field for local manufacturers, allowing them to compete more effectively against foreign competitors. They believe that a stronger domestic market will lead to job preservation and potential job creation in the steel sector.
However, critics of the tariff increase warn that such measures may lead to higher prices for consumers and businesses reliant on imported steel products. They fear that the reduced competition could stifle innovation and efficiency among domestic producers, as they may become complacent in a more protected environment.
