See how the government’s measure to reduce car prices will work
Discount on the final price will take into account the current price, pollutant emissions and percentage of domestic parts. Anfavea predicts that new vehicles may once again cost less than R$60,000. Alckmin: ‘cheap cars will have tax reductions’ The federal government announced this Thursday (25) that it will reduce taxes on popular cars by up to 10.79%. The objective is to lower the price of the “cheaper” vehicles. Here’s how it will work: 🚗 The measure will apply to vehicles with a final value of up to R$ 120 thousand. Discount It will vary from 1.5% to 10.79%, based on three factors: current value of the vehicle: the cheaper the car, the greater the tax discount; emission of pollutants: the cleaner the engine and the production process, the greater the discount; production chain: the greater the percentage of parts and accessories produced in Brazil, the greater the discount. Currently, the starting price of the brand new car is around R$68,000 – more than 50 minimum wages (today at R$1,320). The government is also considering allowing the direct sale of cars to individuals. The Vice President of the Republic and Minister of Development, Industry, Commerce and Services, Geraldo Alckmin, stated that: “The smaller the car, the more accessible, the greater the discount.” The president of the National Association of Motor Vehicle Manufacturers (Anfavea), Márcio de Lima Leite, said that: “It is very possible to have prices below R$ 60 thousand.” Deadline The Ministry of Finance will have a period of 15 days to adjust the decision to the fiscal rules – that is, calculate the loss of collection and say what the compensation will be in the budget. Barriers The interest charged on car financing is higher than the Selic, which today is 13.75%. According to the Central Bank, the average rate for banks on this credit line was 28.6% per annum in March. “Interest is difficult to resolve from one day to the next. But it is possible to think of mechanisms for accessing credit that may facilitate it,” said the president of Stellantis, Antonio Filosa.