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Brazil eliminates taxes on ethanol

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(Globalpost/GlobalPost)

Brasilia, Apr 23 (EFE).- The Brazilian government announced Tuesday that starting May 1 it will increase the obligatory blend of ethanol with gasoline from 20 to 25 percent and will eliminate all taxes on the sugar-based fuel.

Those decisions aim to "diminish gasoline consumption" and reduce fuel prices, as well as making the industrial sectors engaged in producing ethanol more competitive, Finance Minister Guido Mantega told a press conference.

These measures will be complemented by an offer of new state credit lines for the sector to the amount of 4 billion reais ($2 billion), to be used to finance the planting of the next sugar cane crops and the expansion of croplands.

Mines and Energy Minister Edison Lobao told the same press conference that with this aid package "ethanol will be consolidated in Brazil," with the goal or reaching an annual production of 28 billion liters (7.4 billion gallons) this year.

Elizabeth Farina, president of the Union of the Sugar Cane Industry, said that these measures "are going in the right direction."

http://www.globalpost.com/dispatch/news/agencia-efe/130423/brazil-eliminates-taxes-ethanol