The elimination will hurt the country’s tax base, but the levy on lower value shirts, electronics, toys and kitchen gadgets ultimately proved too unpopular among Brazilians ahead of the October 4 presidential election, forcing Brasilia to back down.
In an apparent attempt to minimise media exposure over a domestic scandal involving a bank recently closed by local authorities, which has implicated several of his allies, Brazilian President Luiz Inacio Lula da Silva has opted not to hold a signing ceremony for the legislation negotiated over weeks with Congress.
But in a video posted by his campaign on social media last week, he commented on the initiative, stating that its approval was a matter of social justice.
“The upper-middle class travels abroad, spends 2,000 dollars, and pays no tax. Why is it that when a person from the favelas … buys something for 50 dollars, they want to tax them?”
“It is simply a matter of justice … so that the Brazilian people can buy the things they need without anyone bothering them,” the president said.
