{"id":93615,"date":"2025-04-04T17:27:09","date_gmt":"2025-04-04T20:27:09","guid":{"rendered":"https:\/\/murray.adv.br\/?p=93615"},"modified":"2025-04-04T17:27:11","modified_gmt":"2025-04-04T20:27:11","slug":"retailers-brace-for-fallout-from-u-s-tariffs-on-chinese-goods","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/retailers-brace-for-fallout-from-u-s-tariffs-on-chinese-goods\/","title":{"rendered":"Retailers brace for fallout from U.S. tariffs on Chinese goods"},"content":{"rendered":"\n
Industry fears an influx of low-cost imports and pressure on local jobs and production as Chinese sellers seek new markets<\/strong><\/em><\/h6>\n\n\n\n

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04\/04\/2025 <\/p>\n\n\n\n

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Brazilian retailers and consumer goods manufacturers are expressing concerns<\/strong> about the potential impact of the U.S. government\u2019s recent decision to impose higher tariffs on certain Chinese products, according to industry representatives. As of May 2, items shipped from China and Hong Kong to the United States that cost up to $800\u2014previously exempt from import duties\u2014will now be taxed at a 30% rate.<\/p>\n\n\n\n

There is growing apprehension that some of these goods, which are often cheaper than those produced locally, could be redirected to Brazil. Industry leaders also fear that the Chinese government might increase export subsidies to support businesses hit by the new U.S. tariffs\u2014measures that could further distort global trade.<\/p>\n\n\n\n

The Brazilian Textile and Apparel Industry Association (ABIT) warned of a potential \u201cavalanche of Asian imports,\u201d which could overwhelm domestic producers in what has been dubbed the \u201cblouse war\u201d\u2014a metaphor for the fierce competition between foreign and local brands in Brazil\u2019s retail market originated from the flood of cheap clothes from China.<\/p>\n\n\n\n

As Asian products become more expensive for U.S. buyers, online marketplaces and merchants selling through those platforms may look for alternative markets to offset revenue losses. They could also attempt to absorb part of the new 30% duty, potentially with government backing from Beijing.<\/p>\n\n\n\n

According to Jorge Gon\u00e7alves Filho, president of the Retail Development Institute (IDV), foreign companies selling in Brazil already pay a combined 44.6% in taxes, factoring in import duties and the standard 17% state-level sales tax (ICMS). In states where ICMS reaches 20%, the total tax burden rises to about 50%. For domestic retailers, the effective tax rate can be as high as 80% to 100%, depending on the sector.<\/p>\n\n\n\n

\u201cThey [Asian companies] pay half of what we do,\u201d Mr. Gon\u00e7alves said. \u201cThat imbalance makes the country more vulnerable to imports. It\u2019s only natural they would look for alternatives after Trump\u2019s tariffs. This could harm us, and we\u2019re waiting to gather data to assess the impact,\u201d he added. \u201cIf countries with more protectionist policies begin subsidizing prices here in Brazil, we\u2019ll quickly feel the consequences, especially in terms of job losses.\u201d<\/p>\n\n\n\n

Mr. Gon\u00e7alves cited data from Brazil\u2019s General Register of Employed and Unemployed Persons (CAGED), which shows an uptick in retail job creation since August, when the country began taxing shipments under $50 at a rate of 20%, ending the previous tax exemption.<\/p>\n\n\n\n

Although many of these platforms depend on consumer demand, some produce and sell their brands. They often use subsidies to boost sales\u2014such as covering part of the taxes paid by customers\u2014or adopting aggressive pricing strategies in certain countries through incentives offered to third-party sellers.<\/p>\n\n\n\n

These e-commerce websites have the autonomy to define their pricing and tax strategies on a country-by-country basis. In 2023, Shein partially covered ICMS taxes for buyers in Brazil.<\/p>\n\n\n\n

According to two sources familiar with the lobbying efforts of Chinese platforms in Bras\u00edlia, foreign marketplaces have been developing contingency plans since the beginning of the year. Until the announcement by former U.S. President Donald Trump earlier this week, the expected tariff increase was 10%, not 30%\u2014a rate that could also be applied as a flat $25 per item, rising to $50 after June 1.<\/p>\n\n\n\n

While more mature markets such as Japan and the United Kingdom\u2014both with lower import duties\u2014are natural targets for redirected shipments, Brazil\u2019s significance as a fast-growing consumer market means that some of the redirected goods are likely to land there too, according to industry insiders.<\/p>\n\n\n\n

On social media, ABIT president Fernando Pimentel warned that several major exporters of textiles and garments to the U.S. are likely to be severely impacted by the new American tariffs. Even with the new duties, taxes in the U.S. remain lower than in Brazil.<\/p>\n\n\n\n

\u201cWe don\u2019t yet know how they\u2019ll respond to this tax tsunami,\u201d Mr. Pimentel wrote on LinkedIn. \u201cBut given how vital these exports are to their economies, they will seek new markets\u2014and here lies the danger: that Brazil becomes a prime destination, putting pressure on local production, investment, and employment.\u201d<\/p>\n\n\n\n

He called for immediate \u201clegitimate trade defense measures\u201d to avoid being overwhelmed by a flood of low-cost Asian imports. \u201cWe were already actively working on this front, and now we must double down,\u201d he said.<\/p>\n\n\n\n

The largest Asian consumer goods platforms operating in Brazil include Shopee, Temu, Shein, and AliExpress.<\/p>\n\n\n\n

Shein declined to answer questions about potential impacts in Brazil and said it would respond via AMOBITEC, a trade group representing mobility and technology companies. AMOBITEC said that it is too early to evaluate the consequences of the U.S. decision, and emphasized that Brazil\u2019s high taxes\u2014among the highest in the world\u2014remain a barrier to large-scale market shifts.<\/p>\n\n\n\n

\u201cWe cannot lose sight of the fact that taxes on purchases in Brazil remain the highest globally,\u201d the group said, noting that the announcement alone is unlikely to significantly alter current trade flows.<\/p>\n\n\n\n

AliExpress, Shopee, and Temu did not respond to requests for comment.<\/p>\n\n\n\n

According to the director of a textile manufacturer in Minas Gerais state, Brazil could soon face a \u201ctorrent\u201d of Chinese imports due to the U.S. tariff changes.<\/p>\n\n\n\n

When asked whether Brazil\u2019s relatively closed economy might shield it from such a wave, he said that even with the 20% import tax and ICMS, Asian platforms continue to grow rapidly in Brazil\u2014often outpacing domestic retailers\u2014making the country an attractive alternative.<\/p>\n\n\n\n

To illustrate the scale of the potential impact, the U.S. Customs and Border Protection processes over 4 million shipments of up to $800 per day. In Brazil, the Federal Revenue Service reported about 187 million international parcels in 2024 so far\u2014an average of 520,000 per day.<\/p>\n\n\n\n

*By\u00a0Adriana Mattos\u00a0\u2014 S\u00e3o Paulo<\/strong><\/p>\n\n\n\n

Source: Valor International<\/p>\n\n\n\n

\nhttps:\/\/valorinternational.globo.com\/\n<\/div><\/figure>\n","protected":false},"excerpt":{"rendered":"

Industry fears an influx of low-cost imports and pressure on local jobs and production as Chinese sellers seek new markets 04\/04\/2025 Brazilian retailers and consumer goods manufacturers are expressing concerns about the potential impact of the U.S. government\u2019s recent decision to impose higher tariffs on certain Chinese products, according to industry representatives. As of May 2, items […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[26004],"class_list":["post-93615","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-fallout-from-u-s-tariffs-on-chinese-goods"],"yoast_head":"\nRetailers brace for fallout from U.S. tariffs on Chinese goods - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/retailers-brace-for-fallout-from-u-s-tariffs-on-chinese-goods\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Retailers brace for fallout from U.S. tariffs on Chinese goods - Murray Advogados\" \/>\n<meta property=\"og:description\" content=\"Industry fears an influx of low-cost imports and pressure on local jobs and production as Chinese sellers seek new markets 04\/04\/2025 Brazilian retailers and consumer goods manufacturers are expressing concerns about the potential impact of the U.S. government\u2019s recent decision to impose higher tariffs on certain Chinese products, according to industry representatives. 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