Ethanol prices in Brazil have been on the rise following recent measures to increase gasoline taxes in the country, reports Platts.
Since the announcement on taxes made by the country's finance minister January 19 ex-mill hydrous fuel ethanol prices assessed by Platts have surged 7%, rising by R$ 100 to R$ 1,600/cubic meter.
To reinstate the Cide tax, the government needs a notice period of 90 days before the change takes effect. To collect the full tax during the waiting period, the government temporarily increased the PIS/Cofins tax. The law calls for the PIS/Cofins tax to increase to 48 cents/liter as of February 1. After the 90-day period, the Cide tax will be reinstated at 10 cents/liter while the PIS/Cofins tax will be reduced to 38 cents/liter.