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2/10/2017 Brazil's 'Most Expensive iPhone' Becomes The Subject Of Mockery
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LISTS 11/24/2014 @ 4:05PM 53,736 views
Brazil's 'Most Expensive iPhone'Becomes The Subject Of MockeryHome to the world’s most expensive iPhone,Brazil has long been considered one of thepriciest countries. The high taxes paid byBrazilians (about 36% of the country’s GDP,considerably more than the 21% average foruppermiddleincome countries and really a jokeif the woeful public services provided toBrazilians are taken into account), Draconianimport duties (Brazil applies a 60% flat importtax on most manufactured retail goods), harshlabor laws that make it hard to use workersefficiently and currency exchange fluctuationsare some of the reasons behind the socalled“custo Brasil” — or simply the “Brazil cost.”
Just to keep things fresh, both Ikea and H&M,two of the biggest names in retailing, haverecently given up on plans to open stores inBrazil due to the country’s import tax.
Last year Brazil topped a list compiled byBloomberg of the most expensive countries tobuy an iPhone. Keeping in mind that the list wasreleased months before the launch of the newiPhone 6, the South American nation led the packof “iPriciest countries” thanks to its tag price of$1,196 for an iPhone 5S. The same model couldbe bought at the time in the United States for$815.
Anderson Antunes Contributor
Business & Wealth News From Brazil
Opinions expressed by Forbes Contributors are their own.
2/10/2017 Brazil's 'Most Expensive iPhone' Becomes The Subject Of Mockery
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Apple’s iPhone 6 (PHOTO: Pablo Blazquez Dominguez/Getty Images)
The new iPhone 6 is being sold in Brazil for$1,254 (R$ 3,200) — or about twice the pricepracticed in the U.S. No wonder the hugedifference was the subject of mockery on Brazil’stop rated latenight talkshow last week, as hostDanilo Gentili read a list of 5 things to do inBrazil with the money that can be used to buy aniPhone 6. The list included topics such as to helpcover the losses from Petrobras’ corruptionscheme, in reference to the bribery scandal thatis being probed in Brazil’s statecontrolled oilgiant; and to use an iPhone 5 to call a girl, takeher to Miami, and come back to Brazil with twoiPhones 6.
(By the way, Gentili told FORBES he has noplans of buying an iPhone 6 anytime soon. “Ihaven’t bought an iPhone 6 yet and if I ever buyone, it won’t be in Brazil. The less money I giveto this corrupt government the better. Ever sinceI was poor I used to pay loads in taxes and gotnothing in return. If I ever buy an iPhone 6 itwill be abroad, during one of my trips. But Ireally didn’t like the new iPhone, it’s too big andI am happy with my 5S,” he said.)
In reality, though, the expensive price of a mereiPhone in Brazil symbolizes one of the country’sbiggest bottlenecks, which are the hugeoperational costs that create several difficultiesfor anyone hoping to be doing business there.Recently reelected President Dilma Rousseff willhave to tackle those issues in order to continueexpanding the social and economic achievementsof her predecessor, Luiz Inacio Lula da Silva.
Poorer Brazilians voted for Rousseff in theOctober elections mostly because of her party’strack record in lifting millions out of poverty, buther government has been marked byinterventionist policies that stifle confidence andtrade and an apathy to act in the promotion of
2/10/2017 Brazil's 'Most Expensive iPhone' Becomes The Subject Of Mockery
http://www.forbes.com/sites/andersonantunes/2014/11/24/brazilsmostexpensiveiphonebecomesthesubjectofmockery/print/ 3/4
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much needed reforms to win back investor andconsumer confidence and get Brazil growingonce again. Rousseff’s stubbornness in dealing with certainsectors of society, like industry, has weakenedthe policy used by the Workers’ Party in Brazil’srecent prosperity boom: inflation under control,a floating exchange rate and steady reductions inthe national debt.
Change was the word of the presidentialcampaign this year, but the word for Rousseff’snew government should be reform. Now is thetime for comprehensive tax reform that willreduce the tax burden and create a simpler, progrowth tax code. Brazilians deserve tax reform.Higher taxes are not the solution to the debtproblem. Instead, Rousseff must focus onkeeping taxes low so individuals and businesseswill be able to keep more of their hardearnedincome. When we lower the tax burden, weencourage investment, job creation, andeconomic growth. More certainty and simplicityin the tax code would send a clear message to jobcreators that Brazil is a good place for business.
Plus it would allow Brazilian taxpayers to spendtheir own money thus stimulating the economyby buying consumer goods, like an iPhone, butfor a fairer price.
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