UPDATE: Momentum continues on DF allowances; Brazil awaits ‘change’

By Luke Barras-hill and Andrew Pentol |

Rio-Dufry-arrivals

Dufry arrivals shop at RIOgaleão Tom Jobin International Airport Terminal 2.

The Asociación Sudamericana de Tiendas Libres (ASUTIL) has vowed to continue working to secure allowance increases elsewhere after it emerged that a long-awaited move to increase Brazil’s inbound duty free limit at airports is in sight.

Brazil’s federal government has revealed a plan to double the current limit to US$1,000.

President Jair M. Bolsonaro said on Friday via Twitter: “The @MinEconomy Paulo Guedes, at our request, prepares a decree for the coming days. Brazilians returning from overseas travel will be able to buy $1,000 worth of products at airports — today the limit is $500.”

In a simultaneous announcement, Bolsonaro revealed a rise in the purchase quota for Brazilians crossing the border into Paraguay from US$300 to US$500 per person.

Jose-Luis-Donagaray-IAADFS-2017

José Luis Donagaray, Secretary General, ASUTIL.

MERCOSUR ISSUES REMAIN

Speaking to TRBusiness following the Brazil developments, José Luis Donagaray, Secretary General, ASUTIL said: “We must increase allowances in other areas and work on some issues relating to the list of products able to be sold in Mercosur land border duty free shops.

“It is important to harmonise the border systems in the Mercosur and continue working.”

Should the Brazil decree be implemented it would provide a significant fillip to retail operators such as Dufry, which benefits greatly from the country’s flourishing arrivals duty free business.

It would echo similar moves by Uruguay and Argentina in lifting their duty free allowances from US$500 to US$650 and US$300 to US$500, respectively.

Donagaray had indicated to TRBusiness in March that a prospective raise in Brazil’s duty free threshold would materialise before the end of the year.

Emphasising the significance of the Brazilian allowance increase he added: “As I explained, we have increased the allowances in Uruguay, in Argentina, in airports and on all Mercosur borders. We have also made changed in Paraguay and now Brazil.

“For us, this is very important as it helps all the business. It benefits expensive brands and small products like chocolate. If the allowance is small and you want to buy a perfume, for example, you might end up purchasing the perfume and not some of the smaller products.

“When duty free allowances increase, it benefits all the suppliers and all the different products. It gives customers scope to purchase other products as well as expensive items such as perfumes and cosmetics and some electrical items.”

More to follow…

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