Brazil Tablet Prices May Fall After Tax Cut, Bernardo Says

May 17 (Bloomberg) -- Prices of tablet computers in Brazil may fall as much as 36 percent after the government cuts taxes on their production and sale, Communications Minister Paulo Bernardo told reporters today in Brasilia.

The government is seeking to ensure an investment by Foxconn Technology Group in Latin America’s biggest economy. The maker of Apple Inc.’s iPhone and Dell Inc. computers is holding talks with the government to expand their manufacturing in Brazil, President Dilma Rousseff said during her trip to China in April.

Positivo Informática SA, Motorola Mobility Holdings Inc., Samsung Eletronics Co Ltd, Foxconn Technology Group and ZTE Corp are among the companies that can benefit from the tax breaks, Bernardo said in an interview yesterday with Bloomberg News.

Brazil set up a working group to make Foxconn’s proposal to invest in the country viable, Science and Technology Minister Aloizio Mercadante said in April. The Taiwanese company will need infrastructure such as broadband services and airports, and its investment in Brazil would probably attract a semiconductor manufacturer to the South American country, Mercadante said.

The government plans to send a bill to Congress this week eliminating some sales taxes, known as PIS and Cofins, and reducing to 3 percent from 15 percent the tax on industrialized goods produced in some states, Telecommunications Secretary Nelson Fujimoto told reporters in Brasilia yesterday. The government is also in talks to cut state sales taxes.

Brazil may extend tax cuts on books to electronic book readers, so-called e-books, according to a bill approved today by the Senate’s Economic Affairs Committee. The bill is pending approval by the Senate’s Education, Culture and Sport Committee before taking effect, according to a statement posted by Senado news agency on its website today.

To contact the reporter on this story: Carla Simoes in Brasilia at csimoes1@bloomberg.net

To contact the editor responsible for this story: Joshua Goodman at jgoodman19@bloomberg.net