Brazil's Duty-Free Policy For Solar Panels

In Brazil, solar panels exempted from import duties and related taxes must strictly adhere to the country's specific policy framework and quota mechanism. The following is a detailed analysis based on Brazil's latest trade policies, industry practices, and the technical characteristics of solar panels:

Brazil's solar panel import policy has undergone several adjustments in recent years:

Early Duty-Free Period (Until the End of 2023)

Brazil previously exempted solar panels from import duties (II), industrial product taxes (IPI), social integration taxes (PIS), and social security contributions (COFINS) through various policies (such as the Semiconductor Industry Technology Development Support Program PADIS and the Zero Tariff List), valid until the end of 2023.

During this period, all solar panels, regardless of power level, were eligible for duty-free treatment.

Policy Shift (Starting in 2024)

Due to the development needs of the domestic photovoltaic industry, Brazil will resume collecting import tariffs starting January 1, 2024:

Quota System Implementation: Solar panels with the customs code (8541.43.00) will be subject to a dual-track system: duty-free within the quota and taxable outside the quota.

In-quota: 0% tariff until June 30, 2025;

Out-quota: The tariff rate will be significantly increased from 9.6% to 25% (intended to protect domestic production).

The quota amount will decrease annually from 2024 to 2027 (e.g., from US$1.13 billion for January to June 2024 to US$717 million for July 2025 to June 2026), ultimately returning to zero.

How can solar panels achieve customs exemption? (Using HJT solar panels as an example)

To exempt solar panels from customs procedures in Brazil, they must meet the following core conditions:

1. Must be included in the duty-free quota

Brazil's duty-free quota allocation applies to all types of solar panels (including HJT, TOPCon, PERC, and other technologies), but requires an application process to obtain an import permit:

Quota applicants: Local Brazilian importers or registered companies must submit applications through the Brazilian Integrated Foreign Trade System (SISCOMEX). The initial quota cap is US$10 million per company.

Quota Allocation Rules:

Group A quota (30%): Priority allocation will be given to large importers whose import volume in 2022–2023 accounts for ≥2% of Brazil's total.

Group B quota (70%): Allocation will be made to other companies based on the order of application, on a first-come, first-served basis.

Validity: The quota is valid until June 2026, and the policy may continue, but with tighter conditions.

2. Product Compliance Requirements

Even within the quota, imported solar modules must still meet the following requirements:

Customs Declaration Specifications: Accurately declare product parameters (e.g., power 700W, HJT technology, double-glass design, etc.) to avoid the risk of tax surcharges due to misclassification.

Certification Standards: The Brazilian market generally requires modules to be certified by INMETRO (Brazilian National Institute of Metrology, Standardization and Industrial Quality) and IECEE CB certification to ensure compliance with safety, performance, and grid access requirements.

Rules of Origin: Some free trade agreements (such as the potential future China-Brazil photovoltaic cooperation agreement) may affect tariff calculations, but currently, quota policies are the primary factor.

3. Impact of Power Level and Technical Characteristics

Power Positioning: The mainstream power level in the Brazilian market is 500-600W, with power levels above 700W gradually becoming more prevalent. However, this is not a policy-defined duty-free/taxable threshold (e.g., wind power equipment has a duty-free threshold of 7500kVA, while photovoltaic modules do not have a similar rigid power rating).

Apply for quotas as early as possible:

The total amount of duty-free quotas is limited and decreasing. Importers should submit quota applications several months in advance through their Brazilian partners or local branches to ensure they are within the duty-free quota upon customs clearance.

Reference Process: Contact the Foreign Trade Secretariat (Secex) of the Brazilian Ministry of Development, Industry, Trade and Services or an authorized agent to obtain quota allocation details.

Preferred Partners and Supply Chains:

Choose suppliers with local warehousing or distribution capabilities in Brazil to shorten logistics cycles and mitigate the risk of quota fluctuations.

Prioritize INMETRO-certified HJT modules (such as Brazil-adapted models from leading brands such as LONGi, JinkoSolar, and Jingsun).

Tariff Cost Hedging Strategies:

If the quota is insufficient or expires, reserve a 25% tariff budget (out-of-quota tariff rate) and mitigate long-term cost pressures through large-scale procurement, local assembly (KD model), or investment in local production lines.

Monitor policy developments: The Brazilian government may adjust quota rules or extend tax exemptions depending on the ramp-up of domestic production capacity (for example, if domestic production remains insufficient after 2025, some high-power module quotas may be relaxed).

Leverage and comply with policies:

Avoid misreporting parameters or abusing the tax exemption mechanism, as this could result in significant fines, blacklisting, or even legal action. It's recommended to use a professional customs clearance agent or compliance consultant to ensure transparent declarations.