The Rio de Janeiro government announced in a statement on Friday that rice and beans sold in the state will be exempt from the Tax on the Circulation of Goods and Services (ICMS). In addition, the ICMS rate for aviation kerosene will be reduced to 7%.
In the case of rice and beans, the text of the decree also establishes an exemption from ICMS for services involving state and intercity transportation of the two products. In the case of fuel, the reduction is valid for airlines operating in International Flight Connection Centers (HUBs) and airports in the interior of the state.
According to data collected by the Rio de Janeiro government from the aviation sector, approximately 35% of a company's expenses are on kerosene. The government also reported that the reduction in ICMS provides benefits to companies that offer seats at the airports mentioned based on records kept by the National Civil Aviation Agency (ANAC).
Also according to the report, the fuel tax reduction initiative aims to attract more airlines, stimulate new routes and benefit operators that are already present in Rio de Janeiro, increasing the number of international and national visitors.