Soft drink industry criticizes proposed Gleisi

Soft drink manufacturers mobilized to overturn the Senator's proposal Gleisi Hoffmann (EN-PR), who delivered yesterday the report of the provisional measure 675. It proposes reducing tax credits for industries of soft drinks in the Manaus free trade zone. The measure affects Ambev, Coca-Cola, Pepsico, and Kirin Brazil that have in the region factories for the production of extracts and concentrates. Around 90% of the production of soft drinks in the country is made with concentrated processed in the free zone.
The IPI tax rate is 20%, but the industries that produce in the free zone are exempt from this tax. They can use this value as credit for shooting down the collection of other taxes. The Senator made a proposal to reduce the tax rate for tax credits of 20% to 17%. According to the proposal, the credits can only be slaughtered the sale of non-alcoholic drinks, getting barred compensation for beer and other alcoholic beverages. The Brazilian Association of soft drinks and non-alcoholic drinks (Abir) reported that will work so that the project not be approved in Congress. The entity represents 47 companies which together account for 93% of the sector revenue. "The private sector and the Government discussed during two years legislation that changed the tax model for the beverage sector. The Government cannot now change everything, with an interim measure and without discussion with the productive sector, "said Alexander Jobim, President of Open.
The soft drinks Manufacturers Association of Brazil, which represents small and medium-sized manufacturers, also criticized the proposal.
According to data from the internal revenue service, the production of soft drinks in the accumulated from January to July was 6.9% drop, to 8.17 billion liters. The Executive pointed out that despite the fall, the beverage industry has kept the year investments of r $ 7 billion and the level of employment.
The industries of the sector have already had a 10% increase in taxes this year and a reduction in sales and these effects were absorbed with maintenance of jobs. A new change will make the situation more difficult, "said Jobim. The increase of tax burden in Manaus will make it harder to stay in Manaus industries, he added. In 2014, the concentrate was the most exported product by free zone, according to Abir.