The country's tax policy is highly beneficial to the soybean production chain. At the federal level, the estimated tax waiver for the production of this commodity was R$57 billion in 2022, double the tax exemption foreseen for basic food basket products. This is one of the conclusions of a study prepared in partnership by ACT Promoção da Saúde, Instituto Democracia e Sustentabilidade (IDS), Observatório das Economias da Sociobiodiversidade (ÓSocioBio), Instituto Brasileiro de Defesa do Consumidor (IDEC) and Instituto Sociedade, População e Natureza (ISPN), which mapped and calculated the country's tax cost for the soybean chain, aiming at the discussion of tax reform. Access the study here.
Analyzing tax waivers at the state level, the ICMS (Value-Added Tax) exemption for soybeans amounts to almost R$8 billion per year in Mato Grosso alone. "It is safe to assume that other producing states have similar levels of tax exemptions, which allows us to estimate that the total tax exemptions for these states could reach close to R$25 billion, since Mato Grosso accounts for 1/3 of national production," the report highlights.
Regarding crop financing, data from 2022 provided by the Central Bank indicate that, of the total rural credit available to finance Brazilian crops, no less than 52% of the resources were allocated exclusively to financing soybean crops. By comparison, approximately 140 crops, almost all of them food crops, received only 28% of rural credit in the country. Basic and healthy foods in the Brazilian diet, such as beans and cassava, are practically excluded from rural credit, accessing only insignificant volumes insufficient to expand production and contain price increases for consumers.
The study argues that the soy supply chain exemplifies a long trajectory of economic cycles characterized by high income concentration, enormous environmental impact, and unjustifiable privileges. Historically, tax policy, combined with other public policies, has favored soy production to the detriment of other alternatives necessary for the food security of the Brazilian population, resulting in billions in tax breaks and enormous environmental costs.
According to the organizations involved in the survey, the Brazilian State has already fulfilled its role in supporting the structuring of the soy sector and, with the tax reform, has the opportunity to rethink priorities, considering the fight against hunger with healthy and sustainably produced foods, as well as the need for various other possible investments from these public resources currently allocated to the soy production sector.
"It is necessary to review tax instruments in light of current challenges and put them at the service of other results and strategies, such as combating hunger, reducing food inflation, promoting basic and healthy foods and discouraging foods of poor nutritional quality, such as ultra-processed foods, in addition to promoting production, processing and consumption systems that can contribute to mitigating the climate crisis," the report suggests.
press release
Jangada Communication Consulting
Larissa Fonseca | (13) 99760-5106 [email protected]
Gabriela Clemente | (11) 99541-3452 [email protected]