With the gradual increase in taxes, the federal government has been giving relief to local retailers by closing the siege on foreign e-commerce platforms, especially Asian ones.
With taxes, there was a decline in online sales of imported products and, for the national sector, this is another step in the search for tax equality with its fashion competitors.
Before the implementation of the “blouse tax”, in July this year, around 19 million remittances of up to US$50 were registered, with a total declared value of R$1.812 billion. In August, when 20% import tax began to be charged on items with this value, purchases plummeted to 11 million, a drop of approximately 42% (with a customs value of R$902 million).
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The data is from the September balance sheet of the Remessa Compliance program, which was collected by Santander. The loss of consumers’ willingness to buy foreign products continued in September, with the same amount of remittances registered in the previous month (11 million, with an increase of just R$42 million in declared taxes).
Effects
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Santander’s head of retail, Ruben Couto, highlights that national retailers gained market share during the year, which coincides with the gradual increases in taxes on foreigners.
In the third quarter, Lojas Renner () had an increase in nominal sales of 12%, compared to the same quarter in 2023. Meanwhile, the clothing market grew less than the brand (6%), according to data from the Monthly Commerce Survey ( PMC/IBGE). Likewise, the pairs C&A (; 19%) and Guararapes (; 11%) also showed growth in sales.
For Couto, the effects of the Remessa program as adopted last year took a while to be reflected in financial statements, as international companies were gradually joining the program and, according to him, tax increases always generate “a big political discussion due to have a more unpopular bias.”
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“Since the first quarter of this year, the gain in share of those listed here in Brazil has become much more rhythmic, especially because it has made retailers wake up to the world of e-commerce, which is a strategy already dominated by cross-border commerce. [comércio transfronteiriço]”, says the professional.
According to BTG Pactual’s consumer and retail analyst, Luiz Guanais, at the beginning of 2024 there was a price difference between 25% and 30% in the relationship between local and foreign retail products. However, after implementing the “blouse tax”, the bank identified that the price difference reduced to 10%.
In both cases, local products continued to be more expensive than foreign ones and the calculations were made based on a basket of products from the companies Renner, C&A and Guararapes in relation to Shein.
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However, Guanais highlights that the increase in taxation was not solely responsible for reducing the price difference, as there was also a reduction in the prices of local products in an attempt to become more attractive to Brazilian customers.
“There has been a reduction in the price difference, and now, with this prospect of an increase in ICMS, despite being a small change it should still help to reduce the gap a little more [diferença] of price. It won’t reduce 100%, but it continues to help to have a little more equity in the taxation of these players”, says the analyst.
Earlier this month, the states announced an agreement to increase the rate of the Tax on Circulation of Goods and Services (ICMS) from 17% to 20% on international orders. Taxation is made on international purchases of up to US$3,000, which are imports carried out under the Simplified Taxation Regime.
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The measure will only take effect from April 1st due to the tax principles of anteriority and nineteen years. In States where the rate applied is less than 20%, there will be a need to forward bills to the respective legislative assemblies.
