Brazil House OKs Tax Breaks For Production Of Tablet Computers

Brazil's lower house in a voice vote Tuesday gave approval to a measure offering tax breaks for national production of tablet computers.

The bill, which still must gain final approval in the Senate, would offer manufacturers full exemption from the country's PIS and Cofins tax.

According to government estimates, the tax breaks could help reduce the final cost to consumers by more than 30%.

The measure was introduced by the government as part of a series of incentives to attract foreign tablet manufacturers to the country. In addition to exemption from the PIS and Cofins taxes, the government has also pledged reductions in the IPI industrial products tax and the II import tax.

Of a total of 12 million computers produced in Brazil last year, only 100,000 were tablets.

Earlier this year, Taiwanese computer manufacturer Foxconn Technology Co. (2354.TW) announced plans to produce Apple Inc.'s (AAPL) iPad tablet in the Brazilian city of Jundiai in Sao Paulo state. In addition to Foxconn, manufacturers Motorola Mobility Holdings Inc. (MMI) and Asustek Computer Inc. (ASUUY, 2357.TW) have also expressed interest in producing tablets locally.

-By Gerald Jeffris, Dow Jones Newswires; (5561) 3335-0832, gerald.jeffris@dowjones.com

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