Tax cuts 'will encourage foreign investment in Brazil's furniture industry'
Date added: 26th November, 2009 at 09:25
(view all articles from November, 2009)
Categories: Economy
Foreign investment in Brazil's furniture manufacturing will be spurred by a government tax break for the sector, the country's finance minister has announced.
Guido Mantega told reporters yesterday (November 25th 2009) that companies will have to pay no tax on items such as chairs and tables, effective immediately and remaining in place until March 31st next year.
Speaking to the Wall Street Journal, Mr Mantega described the sector as "neglected". Consequently, he explained the government felt it was time to encourage greater overseas investment in Brazil's furniture products by allowing firms to offer cheaper prices.
"Furniture manufacturers are heavily dependent on exports, which have not recovered [from the recession]. We thought it was time to do something for this industry," he explained.
Similar tax breaks have been put in place by the Latin American country's government during 2009 for the benefit of its automotive industries.
The news comes after carmaker Ford released plans to invest in Bahia, spending four billion reais (£1.4 billion) to increase the output of a facility in the North East state.
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