Question

You are consulting for Link Snack, Inc., a firm that wants to export from the United States to Brazil. The firm wants to export packaged Jack Link’s Beef Jerky. Presume each package costs $1.00.

Link Snack, Inc. needs you to find some information that will help them evaluate the profitability of exporting their products.  They need to know the following information:

1. How Brazil would classify/categorize their product for the purpose of determining import tariffs. (Tariffs may be called other names such as duties or taxes in various countries)
2. What import tariffs would apply and how much would they be on the product.
3. As this is a food product, any packaging and labeling requirements there would be.

For each question, they need a brief response by you and a web link to the resource information you used to develop your response. Particularly helpful are web links provided by Brazil.

Answer 1

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How does Brazil classify/categorize their product for the purpose of determining import tariffs. (Tariffs may be called other names such as duties or taxes in various countries)

Brazil currently uses the Harmonized System (HS) Customs Code to classify goods. Import duty rates are assessed on the basis of weight, value or volume are subject to change annually and range between 0%-20%. Goods arriving in the country may be subject to import duty, Value Added Tax (VAT), National Health Insurance Levy, inspection fee, ECOWAS Levy, Brazil Customs Network duty, special tax and import excise duty.

What import tariffs would apply and how much would they be on the product.

Brazil operates a relatively free market, having comparatively low tariffs on imported products. There is a high demand for imported food products, especially consumer ready products, due to limited selection of products provided by the underdeveloped domestic agricultural and food processing sector in Brazil . Food items to Brazil from the United States would have an import duty tax of 5%. FDA must approve all advertisement and promotional materials (including the contents to be used) before they are utilized. This approval is in addition to the Certificate of Registration of food product issued by the FDA that authorizes importation and sale in Brazil . Exporters may advertise in the print and electronic media (Radio, TV), billboards, posters and point of sale displays. Imports require a custom clearance, Value Added Tax (VAT) inspection fee, ECOWAS Levy, and Brazil Customs network fee.

As this is food product, any packaging and labeling requirements there would be.

Under Brazil 's General Labeling Rule, all products imported or produced locally should bear the following, in English:

· Name of product;
· Net mass or weight or net volume of content;
· Composition of content of product;
· Date of manufacture of product;
· Date of expiry of product (or best before date);
· Batch or lot number of product;
· Name and address of manufacturer or agent;
· Directions for use, if relevant;
· Any special instructions for storage, handling; etc. and
· Any pertinent warnings.

The Food and Drugs Board (FDB) is the Government of Brazil ‟s (GOG) regulatory body with the responsibility of implementing Food and Drugs Law of 1992, (PNDCL 305B) to regulate the manufacture, importation, exportation, distribution, use and advertisements of food, drugs, cosmetics, medical devices and household chemicals with respect to ensuring their safety, quality and efficacy. All food products imported, advertised, sold or distributed in the country must first be registered with the FDB under Section 18 and 25 of the Food and Drugs law, 1992 (PNDCL 305B) and Section 4 (b) of the Food and Drugs (Amendment) Act 523, 1996. A certificate with a registration number is then issued with respect to the product. In addition, only companies duly registered by the Registrar Generals Department shall be permitted to import food and drugs.

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