Brazil’s Sao Paulo state to offer tax breaks to automakers

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Brazil’s Sao Paulo state to offer tax breaks to automakers

On Friday, the 8th of March 2019, the Brazilian state of Sao Paulo said that it would be offering fresh tax cuts to automakers. The news of latest tax incentive for the carmakers in Brazil came forth, after Ford Motor Co had told couple of weeks back that they would be shutting down a plant in Brazil, which was employing more than 3,000 workers and General Motor Co.

had also hinted that they might have following the leads of Ford before backtracking. Until a recent downswing in the economy, from which the nation has still been recovering, Sao Paulo had been one of the world’s five biggest auto making states.

Besides, the state also held a substantial scale of historical significance in Brazilian car making industry. However, Sao Paulo had been falling behind of other Brazilian states, which had been raining incentives over automakers in recent past.

In a press conference, Joao Doria, the state governor of Sao Paulo said that the state were going to offer a tax break of up to 25 percent on Brazilian ICMS value-added tax to automakers, which would be investing as little as $250 million (1 billion reais) and creating at least 400 new jobs, although the state Governor did not mention when the tax incentives would be taking effects.