It is common knowledge that Drawback is one of the largest tax incentives for product exporters who need to import raw materials for production. We should not forget that there is also drawback for the export of services, which are important measures to promote the internationalization of Brazilian companies.
- COST REDUCTION
Since January 1st, the exemption on the Additional Freight for Merchant Marine Renewal (AFRMM) on the imports of materials under the Drawback Exemption regime has been in force.
With the publication of SECEX Ordinance # 37, which approved the 9th edition of the Drawback Exemption System Manual, the Brazilian Internal Revenue Service has stated that in the case of the “exemption” modality there will be no payment of AFRMM, based on article 4, item V, “c” of Law # 10,893, of July 13 2004.
- DRAWBACK SERVICES:
According to Law # 14,440, Brazilian exporters may purchase services such as transportation, insurance, handling and storage of cargo with suspension of taxes, provided that they are, directly and exclusively, linked to the export or delivery, abroad, of a product resulting from the use of Drawback.
3) DRAWBACK FOR MICRO AND SMALL BUSINESSES
Micro and small businesses opting for the Brazilian Simplified Tax Regime “Simples Nacional” may use drawback suspension and exemption schemes. According to Sebrae’s estimates, the change could benefit about 1.5 million companies.
RONALDO MARTINS & Advogados, Attorneys at Law are a team of specialists in foreign trade and taxation who assist clients in the implementation and use of these special regimes for the purpose of optimizing taxation in their business.
For further information, contact Fabíola Paes de Almeida Ragazzo, Tax Consultant and Attorney at Law at Ronaldo Martins & Advogados: fabiola.ragazzo@ronaldomartins.adv.br, phone (11) 99968-5948.
