PS4 Truth

Why is Playstation 4 so expensive in Brazil?


Why so much?

There is big debate among gamers in Brazil and also abroad about why Playstation 4 is so expensive here. People are struggling to find a reason for the astronomical price tag of about $1850. Some blame Sony and some blame taxes, but the truth is: there is no easy answer. In Brazil we pay A LOT more for manufactured goods (especially technology items) compared to what people pay in many countries abroad. The PS4 is an emblematic case, but there are many more examples, especially in the car industry. Why do we have to pay all of that?

Taxes and duties

The tax burden in Brazil is very high, especially for imported goods, like the Playstation 4. For game consoles in particular, they are extremely high! The amount of taxes an duties included in the price tag is almost always a big chunk of it. But that isn't always the sole reason...

Profit

In Brazil many companies have very high profit margins on their products. Some say that happens here because, for different reasons, people are always willing to pay the price. A good example could be the car industry. For example, there is a car that is manufactured in Brazil and sold in Mexico for about half the Brazilian retail price.

How to understand that?

Below there is a calculator that will allow you to understand why the PS4 is so expensive in Brazil. You can see all the taxes involved and adjust the factory, wholesale and retail prices. It will show you what slice of the pie goes to the government and what goes to the companies. Adjust the values and draw your own conclusions.


Calculator

Adjust the values and see the results

The initial values are based on Sony's statement about the PS4 prices in Brazil.

1. Select the factory price:

International shipping and insurance (estimated): $

Customs value: $

Customs expenses (estimated): $

Taxes and duties:

  • Import Duty (20%): $
  • IPI (50%): $
  • PIS (1,65%): $
  • COFINS (7,6%): $
  • ICMS (25%): $

Cost for distributor: $

Total import tax: $

2. Select the wholesale price:

Taxes and duties:

  • IPI (50%): $ - $ = $
  • PIS (1,65%): $ - $ = $
  • COFINS (7,6%): $ - $ = $
  • ICMS-ST (25%): $ - $ = $
  • IRPJ (25% on profit): $
  • CSLL (9% on profit): $

Tax amount for distributor: $

Distributor profit: $ (%)

3. Select the retail price:

Taxes and duties:

  • PIS (1,65%): $ - $ = $
  • COFINS (7,6%): $ - $ = $
  • IRPJ (25% on profit): $
  • CSLL (9% on profit): $

Tax amount for retailer: $

Retailer profit: $ (%)


Company profit: $

Total taxes: $


Please leave your comments below.

The Brazilian tax system is overly complex, and the calculation above is just an approximation of the real values. Some operations involving different states may actually result in a higher tax burden. The math above is considering operations in the state of São Paulo.

Check the Portuguese version of this website.



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