When it Comes to Tech, Dilma Wants Brazilians to “Buy Brazil”

Beatriz Elias is the educational technology director of Editora Moderna, one of the most important publishing companies in Brazil, and has to be up to date on all the latest communication novelties. The same applies to Marina Assis, who works as an advertiser, and Gil Felisberto, a magazine graphic designer. They live and work in São Paulo, the largest and richest Brazilian city, but they each bought their first tablet PC abroad because the prices were considerably cheaper.

However, the next time they go shopping for a tablet—If President Dilma Rousseff and her Communications Minister, Paulo Bernardo, get their way—they could find the best deals on the shelves of Brazilian stores.

Minister Bernardo indicated last week more signs of a plan to cut taxes on tablets manufactured in the country, as part of a policy to boost the Brazilian electronics industry. The tablet category would be included in a product group that already receives fiscal incentives and does not have to pay PIS and Cofins, two taxes collected by the federal government. Without those taxes, the costs of tablet production would be cut by 9.25% to 10%.

Brazilians bought 100,000 tablets in 2010, according to the technology consulting group IDC. For 2011, IDC predicts the number of purchases will total 300,000 tablets bought in the domestic and foreign markets by Brazilians.

The content of the new government policy is still being drafted and is expected to be ready by June. In her first days in office, back in January, Rousseff made clear her intentions to stimulate the consumption of tablets. She said that Brazilians should be able to find options that “fit in their pockets” with prices ranging from 400 reais ($240) to 500 reais ($300), and that could be paid for in several installments per year, a common practice in retailing stores across the country.

Currently, the prices of Apple iPads in Brazil start at around 1,399 reais ($850) up to 2,600 reais ($1,585); while Samsung`s Galaxy can be found for prices ranging from 599 reais ($365) to 2,700 reals ($1,646). These prices are inflated basically by high importation taxes.

Positivo, Brazil’s largest national computer manufacturer, argues that tablets should be included in the computer category to benefit from fiscal incentives that already exist. “The discussion would gain another chapter and would encourage sales with popular prices,” says Hélio Rotenberg, president of the company. “If tablets are considered computers, then the legal framework is already established, and that would hasten the arrival of the product in the homes of a growing number of Brazilians,” he says.

The company says it is investing in research to develop a tablet that fits specific needs of the Brazilian consumer.

The National Association of Electronic Producers (Abinee) is also eager to see the words of Bernardo become reality. “In 2005, when computer production started to benefit from tax cuts, we saw a boom in production and sales,” says Hugo Valerio, a director at Abinee. “Brazilian industry already has the knowledge to start producing tablets. There are companies able to make them within a few months,” he says.

Eike Batista, CEO of EBX and listed the 8th richest man in the world by Forbes, said last November that he wants to start making Apple’s iPad on Brazilian soil. That would happen in an industrial complex he is building on the northern coast of the state of Rio de Janeiro and which is expected to be ready by 2012.

Batista confirmed to the press that contact has been made with Apple`s authorized manufacturers in Asia, and that the next step would be to have the permission of the American company. “Why do we have to pay [in Brazil] 2.5 times the price?” he asked.

That’s the same question that has driven Brazilians to seek better deals abroad.