Imported vehicles: Brazilian tax increase unconstitutional

The recently adopted IPI tax increase of 30 percentage points by the Brazilian government for some imported vehicles is utterly unconstitutional.

The IPI tax is based on two principles: selectivity and essentiality. Discrimination is not allowed on the basis of origin of the product.

Importers and their customers in Brazil are therefore entitled to file a writ of mandamus against such tax increase. The judge must issue an order to clear the import from customs if the petitioner shall previously post a deposit corresponding to the amount of the tax increase. The deposit will revert to petioner upon a final and favorable grant of the the writ.

However, if you already have paid the tax increase on any such imports from abroad, you are nonetheless entitled to file a suit for recovery of the tax excess paid.