BrazilReinstatesTaxBreakThatStandstoBenefitChineseVendors

Brazil has reinstated a tax exemption for imported goods worth $50 or less, giving Chinese cross-border e-commerce sellers a lift as other markets such as the U.S. and Europe tighten restrictions on low-value parcels from China.

President Luiz Inácio Lula da Silva signed an executive order Tuesday removing federal import taxes on low-value parcels, reversing a policy introduced less than two years ago that had sharply raised costs for overseas online purchases.

The decision lowers the overall tax burden on imported packages worth $50 or less to about 20.4%, down from as high as 44.5% previously. A $45 imported item that had cost Brazilian consumers roughly $65 after taxes would now cost about $54.

The Brazilian government said the renewed exemption is aimed at helping lower-income consumers who rely on cross-border platforms for inexpensive daily goods.

The move is expected to benefit Chinese online retailers and merchants that have aggressively expanded in Brazil, one of the world’s fastest-growing e-commerce markets and an increasingly important destination for Chinese exports.

The policy reversal comes as Chinese cross-border sellers face mounting barriers in major Western markets. Since returning to office, U.S. President Donald Trump has tightened tariffs on Chinese imports and ended duty-free treatment for packages valued under $800 from the Chinese mainland and Hong Kong, disrupting the low-cost shipping model that fueled the rise of platforms such as Temu and Shein and forcing them to rework their logistics strategies.

Europe is also moving to curb low-value imports. In November 2025, EU finance ministers agreed to impose a flat 3 euro ($3.5) duty on all parcels under 150 euros starting July 1, 2026, two years earlier than originally planned.

Italy has gone further, imposing a 2 euros levy on low-value parcels from outside the EU beginning Jan. 1, 2026.

Other emerging markets are also tightening controls. Mexico introduced new tariffs last year on low-value imports, including a 19% levy on goods from countries without free trade agreements such as China. Vietnam also ended value-added tax exemptions for low-cost courier imports in February last year.

Against that backdrop, Brazil stands out as a rare large market easing restrictions rather than tightening them.

The country has become a key battleground for Chinese e-commerce companies seeking growth overseas. Alibaba Group Holding Ltd.’s AliExpress entered Brazil more than a decade ago, while Shein, PDD Holdings Inc.’s Temu, and short-video platforms such as TikTok and Kwai have all expanded aggressively in the country in recent years.

With a population of more than 200 million and e-commerce penetration still below that of more mature markets such as China and the U.S., Brazil offers significant room for growth, Thomaz Gelis Fittipaldi, head of China operations at Latin American e-commerce giant Mercado Libre, previously told Caixin.

Contact editor Wang Xintong (xintongwang@caixin.com)