Sector is winning global recognition, but ismoving at a slowpace
Tax
The Brazilian Trade and Investment Promotion Agency (Apex-Brasil) has been promoting the product in fairs and other interna-
tional events, and the Brazilian Micro and Small Business Support Service (Sebrae) gives assistance to the organization of artisanal
drinks across the Country. However, the beverage suffers from the impact of excessively high federal and state taxes. The Brazilian
Cachaça Institute (Ibrac), for example, places emphasis on the fact that 85% of all cachaça producers are, at the moment, in the in-
formal sector because of the heavy tax burden.
Carlos Lima, president of Ibrac, blamed the increase of the Tax on Industrialized Products (IPI), in December 2015, as one of the
factors that negatively affects the competitiveness of the product. The factor rose from up to R$ 2.90 per liter to 25% over the final
value. In the case of premium cachaça, this tax alone represents R$ 12.50. And this is happening at a moment when the quality is
highly valued by most consumers. The resumption of investments by Apex-Brasil, with more support from the supply chain, is one
of the future targets of the sector. And, of course, a reduction in the tax burden.
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