Brazilian House approves bill that vetoes tax benefits for dairy importers ​

On Dec 12th, the Agriculture Committee of Brazil’s House of Representatives approved the Complementary Bill 217/2023, presented by Deputy Heitor Schuch, prohibiting any fiscal benefits to industries that purchase dairy products from abroad.

As explained by the legislator, the objective is to protect the national dairy production chain, which is seriously endangered due to the significant increase in the entry of milk and derivatives in recent months, especially from Mercosur.

Sector data reveals that from January to July of this year, powdered milk imports increased by 268% compared to the same period in 2022. Over 90% of this volume comes from Argentina and Uruguay, both members of the bloc. According to Schuch, the result was a massive drop in the price paid to Brazilian producers and an unprecedented crisis faced by the sector this year.

See below Brazil’s dairy imports from Jan 2020 to Oct 2023. The data is from DataLiner.

Dairy Imports – Brazil | Jan 2020 – Oct 2023 | TEU

Source: DataLiner (click here to request a demo)

When looking at the milk importers in Brazil, it is clear that many multinational corporations have acquired Brazilian firms that previously purchased domestic milk. Many of these have received substantial state benefits, particularly through fiscal exemptions from the Public Power, at the federal, state, and municipal levels,” says Schuch, emphasizing that the result has been a 60% reduction in dairy farms since 2015.

Now, the bill will proceed to the analysis of the Finance and Taxation and Constitution and Justice committees before being voted on in plenary.

Source: MilkPoint

Click here to view the original news piece: https://www.milkpoint.com.br/noticias-e-mercado/giro-noticias/comissao-veta-beneficio-fiscal-a-industrias-que-importarem-lacteos-235865/

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