Lula’s government signals the US that it will end the exemption on the import tax on ethanol – 01/28/2023 – Panel

Representatives of the Luiz Inácio Lula da Silva (PT) administration have already signaled in meetings with the US government that the suspension of the 18% tariff applied on imported ethanol should be ended soon.

The tariff was zeroed by the Jair Bolsonaro (PL) administration in March last year, with the argument that the measure would help reduce the impacts of inflation. The change was celebrated by major North American producers and criticized by Brazilians.

In December, the Chamber of Foreign Trade (Camex), a body linked to the Ministry of Economy, extended the suspension of the tariff until March 2023, but the perspective of the federal government is that the exemption will end before then.

Brazil is the largest sugarcane producer in the world and Brazilian businessmen in the sector showed dissatisfaction with Bolsonaro’s decision to zero the import tax, on the grounds that the country is self-sufficient.

With the tariff resumption, Lula will make a positive nod to the segment sugar and alcohol producer in agribusiness, who in recent years has become closer to Bolsonaro and with whom the PT government is trying to improve relations.

The issue has been dealt with by the Ministry of Agriculture, led by Carlos Fávaro.

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