Source: Diário de São Paulo, 06/08/04

By Nelson Vasconcelos

?At the
bottom, when we talk about piracy we are dealing with terrorists, in Brazil and in developing countries. They do not
bombs explode, but this illegality kills sectors and, in the case of medicines and auto parts, can it even kill consumers?
compare Kapaz. “If we believe that there is a way out of unfair competition, then we will fall into organized crime. Will be
accepting the end of the State ”.

But does it have a way?

“Piracy is useful, or we would not have created Etco (www.etco.org.br). The solution starts with the articulation
of the segments, entities and serious people of the country, who believe that there is still room for ethics. Without ethics, only
we have barbarism ”, says the executive.

According to Etco, what the country needs now
is to discuss anti-piracy actions at different levels. A very important point, which always comes here, is the question of
Tax Burden. Kapaz recalls that the excessive taxation of a certain sector always opens space for solutions
alternatives.

“The case of cigarettes is exemplary. With 65% tax, you don't
nobody smoke less. On the contrary, the smoker ends up smoking more, paying cheaper for a very good quality cigarette.
lower (and therefore even more harmful to health) ”, he says.

The reduction of
rates, however, cannot be the same for all sectors.

"Does not exist
unique solution. What needs to be done is a sector study. The way out for the CD industry, the auto parts industry and the
smoking are not the same ”.

Kapaz cites an interesting case:

? In some sectors, charging more tax does not mean collecting more. Charging less can actually decrease the
unfair competition. See a case here in São Paulo. The State Government reduced the ICMS on hydrated alcohol by 25%
to 12% in December 2003. Since then, consumption has gone up. The real collection in January rose 7%. In May, the market
grew 62% in the year.

And more: the sales of the big distributors, in the
first six months of the year, rose 138%, compared to the same period last year.

This is the logic, therefore: governors can invest in similar solutions, regardless of reform
tax, in eternal discussion.

“The Government needs to give priority to combating
piracy. It would be important to create a central, a council that would assemble a database of illegal operations. THE
from there, it would be easier to format a joint action, with the Revenue, Federal Police, embassies, etc. If the crime
organized, it meets and manages to operate illegally, we have to make this counterpoint ”.

In other words: the scenario is bleak but there are solutions.

“It is a job that is not
resolves in a year or two. It is a persistent action for many years, because there has to be a cultural change. Accept
that the situation is like that means letting pirates take over; means funding a parallel state ”,
sums up Kapaz.