Cars: Government changes standard to export more

After the blow for the increase of
The statistical rate applied to all imports, an increase that will generate an additional $ 30,000 million collection this year, the government decided today to improve repayments – a tax reduction – automotive terminals exporting to Mercosur.

The measure taken by the Ministry of Production and Labor, which leads

Dante Sica

, appears in a context in which
Exports of automobiles – mainly to Brazil, the main trading partner – are not yet improving at the speed expected by the government and facing a deep
internal market depression, generating widespread suspensions in almost all local factories.

The measure was celebrated by local companies and also by the Association of Automobile Manufacturers (Adefa). This celebration was private – without a press release – because the increase in repayments concerned only this sector. "The measure is very positive," they said
THE NATION in this camera.

However, several terminals have questioned the fact that this improvement in export competitiveness comes one day after the government introduced an increase in the import statistics rate, which also affects them.

Through the
Under Decree 338/19 issued today, the government has increased to 6.5% the percentage of tax refunds it grants to companies in the auto sector that export. their production to destinations within Mercosur. The measure, strictly speaking, balances the sector's tax burden for the entire export market and will begin to take effect tomorrow.

In August, the government lowered the reimbursement of local terminals that exported to Brazil from 6.5% to 2%. It was then felt that the strong dollar, the flex and the extra-Mercosur tariff conferred a "considerable" competitive advantage. But for exports outside Brazil, withdrawals remained at 6.5% in order to provide a competitive advantage to market expansion. What was done now was to balance and replace the first 6.5% aliquot.

"We are working on this measure on the basis of the ongoing dialogue we have with the sector and with the various representatives of the entire value chain, and we hope that the unification of the refunds will allow us to recover the dynamism of the level of exports and promote an increase in production units planned for 2019, "said the Minister of Production and Labor, Dante Sica, according to a statement sent by this portfolio.

"As a result of the reorganization of all economic variables in mid-2018 and the modification of export duties, the automotive industry has been affected by lower activity in terms of performance. to export, "they acknowledged near Sica.

"The adequacy of the refund levels applicable to intrazone tariff headings [por el Mercosur] it tends to reverse this process, considering that 60% of local car production is sold worldwide and that, in this percentage, 70% of destinations belong to the countries that make up Mercosur ", he added in Production .

"We have periodically and technically badessed the impact generated by the new macroeconomic scenario and the tax burden on terminal activity," said Industry Secretary Fernando Grbado, adding: "This This allows us to reformulate the forecasts we are working on, so sectoral activity is a very important decision to return to the expected direction on which the sector has made the investments in recent years. "

By 2018, the automotive sector employed more than 60,000 workers, or 6% of industrial employment, and its output reached approximately 490,000 units. In addition, that same year, 284,000 vehicles were exported, 30% more than in 2017, making it the second largest export complex after the grain carrier.

"This is good news, especially after the increase in the statistical rate, which was new and unexpected," they told a European company. "It helps, the problem is the statistical rate, another increase in the cost of production," they agreed in a competitor. "It's a good step to promote export growth projects badyzed," they added in another manufacturing company in the country. "We see this as a positive step," they said in a leading company of Asian origin.

Criticisms of repayments have been much repeated in the sector, as is the one maintained by retentions.