On May 12, the Brazilian federal government signed a provisional decree to scrap the import duty levied on international online purchases valued below 50 US dollars — the so‑called “Blusinhas Tax”. The measure took formal effect on May 13 and may remain in force for up to 120 days unless Congress votes it down or enacts permanent legislation to abolish it.

Under the new rule, cross-border parcels worth under USD 50 are exempt from the 20% federal import duty but still subject to a 20% state ICMS value-added tax. For goods exceeding USD 50, the existing 60% import tariff remains unchanged.

The decision immediately sparked fierce debate among Brazil’s industrial sector, retail industry and international e-commerce platforms.

The National Confederation of Industry (CNI) criticized the policy, stating it effectively grants foreign manufacturers a competitive edge while harming domestic producers. It warned of severe impacts on local small and medium-sized enterprises and potential job losses.

The Institute for Retail Development (IDV) also voiced concerns, arguing that removing the duty on low-value shipments will widen the tax burden gap between domestic and imported goods. As international e-commerce platforms gain further price advantages, Brazilian retailers — especially micro, small and medium-sized businesses — could face substantial sales pressure. The institute further cautioned that companies may cut inventory restocking, with possible factory closures and production line relocations to neighboring countries.

According to IDV data, in the first year after the Blusinhas Tax was introduced, Brazil’s retail sector added approximately 107,000 new jobs, alongside growth in corporate investment and productivity. The body stressed that repealing the levy poses long-term economic risks and threatens numerous businesses and livelihoods.

The Brazilian Textile and Apparel Industry Association (Abit) described the move as “extremely wrong”, warning it will exacerbate unfair competition between local manufacturers and global e-commerce platforms. It pointed out that Brazilian firms endure heavy taxation, high interest rates and complex regulatory costs, while foreign goods can now enter the market at lower prices duty-free. The association also highlighted potential losses in government revenue. Data from Brazil’s Federal Revenue Service shows the tax generated 1.78 billion Brazilian reals in January–April 2026 alone, up 25% year-on-year.

The Brazilian Textile Retail Association (Abvtex) likewise strongly opposed the repeal, calling it “a serious economic setback” that will directly impact Brazil’s industry, retail network and around 18 million nationwide jobs. It emphasized that local SMEs — major contributors to employment and tax revenue — will bear the brunt, and urged the government to introduce compensation measures to prevent business failures and rising unemployment.

Brazil’s congressional Multipartisan Front for Intellectual Property and Anti-Piracy also criticized the policy. Federal Deputy Júlio Lopes, the group’s chairman, stated that competition becomes unfair when domestic companies face heavy taxes while imported goods enter duty-free, undermining Brazil’s employment base, industrial framework and formal business environment.

In contrast to industrial and retail opposition, international e-commerce platforms welcomed the policy change. Amobitec, the Brazilian Association of Mobility and Technology — whose members include Amazon, Alibaba, Shein and 99 — argued that the Blusinhas Tax reduced purchasing power among Brazil’s lower- and middle-income social classes, failed to boost local industrial competitiveness, and instead widened inequality in consumer access to goods.

Introduced in 2024 as part of Brazil’s Remessa Conforme (Import Compliance Program), the Blusinhas Tax targeted cross-border shipments from platforms such as Shein, Shopee and AliExpress.

Rogério Seron, Executive Secretary of Brazil’s Ministry of Finance, stated that over the past three years the government has strengthened oversight of tax evasion in cross-border imports and advanced industry standardization, creating the conditions to eliminate the levy at this stage.