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Coca-Cola blackmails government and threatens to leave Brazil to continue without paying IPI  (tax)











Folha report says president of beverage giant threatened to move factory to Colombia if tax benefits do not come back















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August 22, 2018, 6:14 p.m.
   
Can you imagine that a giant company like Coca-Cola will not pay taxes? This is what happens in Brazil. The billionaire multinational of soft drinks simply receives government subsidies and tax incentives in the Manaus Free Zone that leave it practically tax free, as if it were a philanthropic entity or a church. Now he threatens to leave the country if Michel Temer does not return to the sector the benefits that the government took by decree in June.
According to Folha de S.Paulo , the president of Coca-Cola in Brazil, Henrique Braun, met personally with the Secretary of the Federal Revenue, Jorge Rachid, to make a real blackmail: if the IPI rate is not at least 15%, the company will start producing its syrups in Colombia. A threat that can not be sustained, because, according to the newspaper, "to transfer the production of syrup to another country, Coca-Cola would lose advantages like the 75% discount on the payment of its Income Tax, in addition to paying taxes such as Import Tax and PIS / Cofins ". In addition, it would have to import the concentrate, losing in competitiveness for the competitors.
In the 1990s, Coca-Cola, Pepsi and Ambev also benefited from the fiscal boom, and it was precisely in the 1990s that the origin of the concentrate used in their soft drinks in the Free Trade Zone, where they stopped paying IPI, had different rates of PIS / Cofins, receive 90.25% of the ICMS and have a 75% discount on Income Tax. Meanwhile, the small regional soft drink manufacturers,  the tubaínas , have no exemption whatsoever. How can you?







Temer's decree reducing the IPI discount for the soft-drink sector in the Free Zone has been overturned in the Senate from 20% to 4%, and the lobby of Coca-Cola, Pepsi and Ambev is already moving to overthrow it, also in the Chamber
Perhaps Temer's only judgment so far, the decree reducing the IPI discount for the Zero-Zone soft drink sector from 20% to 4% has  already been overturned in the Senate , and the lobby of Coca-Cola, Pepsi and Ambev is already moving to bring him down also in the House. According to the government, the end of the benefits to the giants of sugary drinks will represent an extra revenue for the country of 740 million reais by the end of 2018. The country is estimated to lose  1.6 billion a year  with tax benefits to these multinationals.

Coca-Cola's own threat that its "exit" from Brazil will result in job cuts does not hold up. The jobs the industry generates in the Free Trade Zone are small compared to the subsidies it receives: the production of concentrates generates only 798 jobs in the Free Trade Zone, against 47,000 jobs in the soft drink factories all over the country. And you are complaining about greed: even with the discount reduction, you will only lose part of the benefits you will continue to have.
"The decree in practice has reduced the high tax credit benefits some soft drink manufacturers receive. Companies such as AmBev and Coca-Cola, in addition to not paying several taxes in the Manaus Free Zone, still receive 20% credit on what they produce there. 

That is, they do not pay the tax (IPI, rate that was 20%) and still receive credit for it. The Brazilian government then subsidizes the production of soft drinks from these factories. The decree decreases this immoral credit from soft drink manufacturers, "  Igor Britto, an attorney with Idec (Institute for Consumer Protection), said at the time .
A country where giants of health-damaging beverages receive subsidies and tax incentives is a Muggle country. Where else would Coca-Cola find such a cakewalk?

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source writing http://www.socialistamorena.com.br/coca-cola-chantageia-governo-e-ameaca-sair-do-brasil-para-continuar-sem-pagar-ipi/

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