European Union files dispute against Brazil on “tax advantages”

Trade & Policy

European Union files dispute against Brazil on “tax advantages”

The European Union has notified the WTO Secretariat on December 19th, of a request for consultations with Brazil over alleged discriminatory tax advantages given by Brazil in the automotive sector; the electronics and related sectors; with regard to goods produced in Manaus and other Free Trade Zones, and tax advantages for exporters.

According to the European Union, these measures increase the effective level of border protection in Brazil whilst providing preferences and support to domestic producers and exporters, by, inter alia: imposing a higher tax burden on imported goods than on domestic goods; conditioning tax advantages to the use of domestic goods; and, providing export-contingent subsidies.