Understand the government’s strategy to reduce the price of popular cars

It was announced by the government that there will be a tax cut in order to reduce the price of popular cars by about 10.96%, the announcement was made this Thursday (25). This strategy is valid for vehicles priced up to R$ 120,000, the objective is to make new popular cars cost up to R$ 60,000, according to the automotive sector.

Natuza Nery conducted an interview with the columnist of the newspaper O Globo Carlos Góes and the journalist André Paixão, the objective was to arrive at a projection of what the practical effects of the disclosed strategy would be and also to talk about the industrial policy adopted by the Lula government.

_{Lula government announces measure to reduce the price of popular cars (Photo: Reproduction/Twitter)}

According to Goes: “The government needs to justify (the tax cut) very well, especially in a context of fiscal adjustment to subsidize large companies in a context where you are asking society to make a fiscal adjustment in other margins. He also highlights the need to discuss the issue “This is the big risk that we need to discuss. Congress needs to debate and the government needs to be transparent on that margin.”

For the columnist of the newspaper O Globo Carlos Góes, also director of the Instituto Mercado Popular, there must be a greater investment in basic scientific research, which would make the sectors serve as a “domino effect” for the economy.

According to Góes, the industrial policy adopted in the face of the automobile sector is the opposite. “The automotive sector is not a sector that supplies inputs to other sectors of the economy. In fact, it is at the end of the production chain and uses a lot of inputs.” concluded

One of the main strategies is the reduction of federal taxes levied on vehicle production, including Pis, Cofins and IPI. According to the government’s proposal, the reduction of these taxes could lead to a reduction of 1.5% to 10.79% in the price of cars.

Featured Photo: Patio with popular cars in Brazil. Playback/Current Amazon