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Brazilian cosmetics industry forecasts price increases up to 12% above inflation

The Brazilian Association of Toiletries, Perfumes and Cosmetics (ABIHPEC), presented a study by consulting firm evaluating the main impacts on the industry and the consumer of the application of the Tax on Industrialized Products (IPI) to retailers.

"The expansion of the collection of the Tax on Industrialized Products (Imposto sobre Produtos Industrializados - IPI) to the toiletry, perfumery and cosmetics retail sector will rise prices up to 12% above inflation. Studies also predict that the new IPI model could eliminate up to 200,000 job opportunities and make sales fall by 17% in 2015. Should these forecasts be confirmed, the ripple effects could paralyze sectorial investments in several areas," said João Carlos Basilio, President of ABIHPEC.

João Carlos Basilio, President of ABIHPEC

João Carlos Basilio, President of ABIHPEC

According to ABIHPEC, the cosmetics industry currently employs over 4.8 million staffs, 80% of them being female employees. "The decrease of sale and worsening of the retail environment will certainly lead to layoffs and a reduction in the number of jobs all along the chain of production and sales, with significant impact on the number of jobs and the income of workers," concluded Joao Carlos Basilio, President of ABIHPEC.

The Presidential Decree 8393, published in the Brazilian Official Gazette (Diário Oficial da União), provides tax increases on perfume, makeup for lips, nails, eyes and face, skin care products, shaving preparations (before, during or after), hair styling products, and others.

© 2015 - Brazil Beauty News - www.brazilbeautynews.com

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