The Brazilian government on Thursday announced import tax reduction on 100 products as a way to keep a strengthening dollar from negatively affecting the nation's manufacturing output.
Brazilian Finance Minister Guido Mantega made the announcement, saying the selected products were mostly destined for the industrial sector, include capital goods, iron and steel, petrochemicals and pharmaceuticals, fertilizers, chemicals and glass.
Last October, Brazil raised import taxes on those products from 8 and 12percent to 25 percent, but the new measure rechanged the rates to their original levels.
"In September 2012, Brazilian industry was besieged by imports and the exchange rate was not favorable. A year later, the conditions exist to return to the previous rates and cut costs for the industry that uses these imported products," said Mantega.
The earlier increase in import rates was strongly criticized by the United States, which accused Brazil of implementing protectionist policies.
By deciding not to renew the highest import rate, the Brazilian government aims to ease inflationary pressure on the economy.
The strong dollar, trading at 2.30 Brazilian reais, versus 2 reais until mid-May, pushed up the price of imports used in industry.