The Drawback regime is an important export incentive mechanism, allowing companies to reduce costs by suspending, exempting, or refunding taxes on inputs used in the manufacture of products destined for the foreign market.

Thus, it contributes to making Brazilian products more competitive in the international arena.

Drawback Modalities

The Drawback regime is divided into three main modalities:

• Integrated Exemption Drawback

This modality allows for the exemption or reduction of taxes on the import or local purchase of inputs equivalent to those that have already been used in the manufacture of previously exported products. The objective is to replenish stocks without the incidence of new taxes.

• Integrated Suspension Drawback

In this modality, there is a suspension of taxes on the acquisition of inputs, whether in the domestic market or through import, when destined for the production of goods that will be exported. This mechanism allows companies to reduce their costs even before starting the production process.

• Refund Drawback

Here, there is a refund of taxes paid on the import of foreign inputs that were used in the manufacture of goods destined for export. Although it is a possibility, this modality is less used today, as companies tend to opt for the exemption or suspension options to avoid the advance payment of taxes.

Advantages of Drawback

Drawback brings several benefits to exporting companies, such as:

• Reduction of costs with taxes;

• Greater competitiveness of Brazilian products in the international market;

• Incentive to production and export;

• Improvement in cash flow, especially in the exemption and suspension modalities.

Conclusion

The Drawback regime is an excellent ally for companies that wish to expand their operations in foreign trade, reducing the tax burden on inputs and making their products more competitive globally.

To use it in the best way, it is essential that companies know the rules of each modality and plan strategically to take advantage of the benefits of this special regime.

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