Brazil attempts a squeeze play

19 Apr

There’s an informative story over at BrazilianBubble.com.

Margins Squeeze: Like China’s JAC Motors, BMW sales also drop 30% in Brazil after IPI tax measures

As Brazil added a tax on imported cars, sales fell on some imported brands by 30%. That’s good news for domestic auto production in Brazil you say? Yeah probably, but that’s not the point to take away from the story.

“Car sales fell 30% due to the IPI raise,” Dornbusch said to Bloomberg. “We’ve partly compensated it by raising prices 15.9% in average, with BMW and dealerships absorbing the rest.”

BMW raised the price of it’s vehicles nearly 16% in order to offset the tax increase. Tell me again how raising taxes doesn’t affect the common person? Oh that’s right, they always have.

Lawyer dog gets it, why can't your Senator?

It’s so simple it’s not even a rule, it’s just plain common sense, don’t pay for something if you don’t have to. Government tells business to pay more, business tells customer to pay more.

Any tax increase is a sign of contempt and stupidity and any politician associated with them should be tossed out of office at the earliest convenience. Only two things come from tax increases. You lose more money and the government has more money to waste on useless junk.

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The original story can be found at Bloomberg.

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