O Brazilian President, Jair Bolsonaro, published last Wednesday (11) a new decree reducing the rates of the Tax on Industrialized Products (IPI) levied on electronic games and accessories. This is the third reduction in tariffs in the sector since the beginning of the government.
Made by means of a presidential decree, which does not depend on Legislative approval, the measure effectively reduces the IPI rates from 30% to 20% for “consoles and video game machines”. In the case of equipment parts and accessories “whose images are reproduced on a screen”, the cut will be from 22% to 12%. the action still encompasses Hardwares with built-in screen, portable or not, and its parts, going from 6% to zero. At the beginning of the government, the rates were 50%, 40% and 20% respectively.
In a statement, the General Secretariat of the Presidency of the Republic explains that the decision "aims to encourage the development of the electronic games segment in the country - the fastest growing branch of the entertainment sector in the world." In two previous decrees, in 2019 e 2020, Bolsonaro had already reduced fares.
The government also informed that the tax reduction will imply a reduction in collection of R$ 82,9 million in 2021. For 2022, the estimated reduction in taxation is R$ 119,5 million. When announced the measure last month, Bolsonaro explained to journalists that reducing this type of taxation is easier, since, as it is an import tax, it does not need a measure to offset it.
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“Some complain: download something else. To download something else, you have to have a compensating source. You games, as it is a resource that comes from import tax, you don't have to find an alternative source for that”, declared the Chief Executive at the time.
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