Temporary Suspension of Brazilian Ethanol Import Tariff

Temporary Suspension of Brazilian Ethanol Import Tariff

RFA defends secondary tariff as means to keep U.S. from subsidizing other countries ethanol production.

The Brazilian Chamber of Foreign Trade has announced plans to temporarily suspend the 20% tariff charged on ethanol imports to the country until the end of 2011. The Brazilian Sugarcane Industry Association hopes the reduction is permanent, especially if countries like the U.S. reduce their tariffs on ethanol imports.

UNICA's Chief Representative for North America Joel Valasco is now asking if the world's number one ethanol producer, the U.S.,
 will follow suit. According to Valasco, consumers win when industries compete. He says ethanol producers in Brazil are willing to compete for consumers. But according to the Renewable Fuels Association, vacillating regulations regarding Brazil
's trade policy undermines its claims for wanting a global trade in ethanol. The group says changing the rules makes it impossible for foreign ethanol producers to even consider exporting product to the country.

RFA says
America needs to continue a constant and consistent trade and tax policy that provides for the growth of the domestic industry, while not penalizing imports should the market demand them. They defend the secondary tariff on imported ethanol, stating it is not a barrier to trade and protects American taxpayers from further subsidizing foreign ethanol industries that already benefit from government support in their own countries.

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