Fiscal surplus within reach

By ETCO
27/05/2015
Evandro Guimarães, Executive President of ETCO
Evandro Guimarães, Executive President of ETCO

Smuggled products from different sectors enter the country illegally without certification and without collecting taxes, bringing huge losses to Brazil.

This is a case of extreme public interest and national sovereignty that is directly affecting the country's tax collection, companies and their production chains, health, security and the country's growth. Smuggling is a crime. It involves corruption.

Recently, this criminal activity has reached proportions never seen before. For some sectors, smuggling now represents more than 30% of the market, as in the case of cigarettes from Paraguay. One out of every three cigarettes sold in Brazil enters the country illegally without paying any taxes and without respecting the technical and health standards that apply to the companies established here.

Even in sectors where measuring the size of smuggling is more difficult, the effects for the population are more than obvious: smuggled toys can seriously harm children, and illegal drugs even have the power to kill those who consume them.

Research commissioned by the Brazilian Institute of Ethics in Competition (ETCO) to Datafolha, and published on Monday (25), shows that the consumption of smuggled products is already rooted in Brazilian society.

About 50% of the more than 2.400 respondents across the country said they knew someone who had already bought contraband products, and 35% said they had already purchased this type of merchandise.

And what leads a good part of the population to assume the risks linked to the consumption of these products is very simple: the low prices of items that enter the country illegally. Nine out of ten people interviewed by Datafolha said that Brazilians would no longer resort to smuggling if national products were cheaper.

Not even the serious effects that smuggling have on different areas, such as public security, health and employment, are enough to discourage this behavior among Brazilians.

How to change this scenario? In 2014, ETCO and the National Forum to Combat Piracy and Illegality started a great movement in defense of the Brazilian legal market. This movement is supported by more than 70 business entities affected by all types of illegality and aims to present proposals and demand solutions.

This mobilization alone is not enough. The Datafolha survey shows that 40% of respondents considered that the federal government is not at all efficient in combating contraband. It is precisely the federal government, through its economic forces and crime enforcement agencies, that has the power to change this situation.

As the government seeks to carry out a strong fiscal adjustment, the benefits that border actions bring in terms of revenue are evident, which outweighs the expenses of large-scale security operations at borders and in cities.

It is not possible for us to remain indifferent to the problems that contraband has brought to Brazil. It is necessary to put an end to all this. Solutions are within reach.