- The tax on industrial products (IPI, in the acronym in Portuguese) on consoles and “gaming machines” will be reduced from 40% to 30%;
- While the tax rate on accessories will be cut from 32% to 22%;
- The measure has an expected impact on revenue of BRL 2.7 million per month this year, informed the Ministry of Economy.
The Brazilian President Jair Bolsonaro announced on Monday a reduction of the tax on industrial products (IPI, in the acronym in Portuguese) on video game consoles, accessories, and games. The change will be published on a decree on Tuesday.
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Bolsonaro said on Twitter that IPI on consoles and “gaming machines” will be reduced from 40% to 30%, while the tax rate on accessories will be cut from 32% to 22%. Bolsonaro also said that the IPI on arcade-type video game machines, which have a built-in screen, and laptops will have been reduced from 16% to 6%.
It is not yet known what the effect of the measure will be on the consumer’s pocket. The IPI is not the only tax on these products. There is also a Tax on the Circulation of Goods and Services (ICMS), of 25%, and a social contribution known by the acronym PIS/Cofins, which has a rate of 9.65%.
In August last year, the federal government had already reduced the IPI on video games, from 20% to 50% to 10% to 40%.
The measure has an expected impact on revenue of BRL 2.7 million per month this year, informed the Ministry of Economy.
Bolsonaro’s announcement comes shortly before the end of year retail sales season, which includes BlackFriday in late November and Christmas, and after months of strong growth in the electronic games industry, fueled by quarantine measures against the coronavirus. In addition, the decree comes before the arrival of the new generation of consoles from Microsoft and Sony, scheduled for the end of the year.
Translated by LABS
