22 March 2013 19:53 [Source: ICIS news]
CAMPINAS, Brazil (ICIS)--Brazilian chemical industry association Abiquim said on Friday that a recent decision by the country's Supreme Federal Court (STF) that eliminates a state tax over imports may have a negative impact on the chemical industry.
The STF exempted sales-tax on circulation of goods and services (ICMS) from the calculation of social contributions charged on imported products.
"The decision introduces a favourable differential for imported products, harming even more the competitiveness of Brazilian industries," said Fernando Figueiredo, president at Abiquim.
According to Abiquim, the nation's chemical sector has been losing its competitiveness over the last 20 years.
"The deficit, which was $1.5bn (€1.2bn) in 1991, increased to $28.1bn in 2012, and it is still growing," Abiquim said in a press statement.
According to Abiquim, another worrisome factor related to the lack of competitiveness of the chemical industry is the idleness of plants.
"The average occupation of the production capacity of the country's chemical industry is stagnated ... on 80% in the last five years, far away from the ideal level of 92-95%," it said.
($1 = €0.77)
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