Cabotage project ‘BR do Mar’ advances in the Senate

Sep, 14, 2021 Posted by Sylvia Schandert

Week 202136

Ten months after its approval by the Chamber of Deputies, one of the government’s priority projects in the area of ​​infrastructure finally shows signs of progress in the Senate. The program to encourage cabotage navigation, known as BR do Mar, had its case heard before the Committee for Economic Affairs (CAE), presented by Nelsinho Trad (PSD-MS), who made important changes to the text.

The report comes out after Trad’s intense negotiation with the Ministries of Infrastructure and Economy. Faced with an issue considered sensitive by truck drivers, who fear the loss of demand for their services, the senator partially met some of the demands of the shipping companies.

Trad reduced the demand for domestic labor in foreign vessels chartered for domestic operation in Brazil and extended the transition period for Brazilian shipping companies (EBNs) to be able to charter without “ballast”, that is, without having their own equipment.

The senator also established an extension to the Reporto, a special tax regime that exempts investments in port terminals and railways. This regime was created in 2004 and had been successively renewed, but it lost validity at the end of last year and the government blocked attempts to include a new extension in amendments to provisional measures that were being processed.

Now, Trad has proposed an extension of the Report from January 2022 to December 2023. The benefit guarantees exemption from IPI and PIS/Cofins for the purchase of machinery and equipment, such as locomotives and portainers, in addition to suspending the collection of import taxes on items that do not have a national equivalent. The suspension also covers the ICMS charged by the states. All together these taxes can add up to 52% onto the cost of investments.

Source: Valor Econômico

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