Taxes threaten BV Steel project

Taxes threaten BV Steel project

Brazilian mining giant Companhia Vale do Rio Doce (CVRD) officials said that local taxes are threatening the company's BV Steel project, which is intended to produce slabs in Brazil's Maranhao state. The project, whose feasibility studies were completed by CVRD, China's Baosteel and Luxembourg-based Arcelor, will initially produce 3.7 million tons of slabs for export. In the second phase of the project, the production will be increased to 7.5 million tons. This total capacity would make the plant Brazil's largest semi-finished steel producer. CVRD officials indicated that the cost of local taxes will amount to 20% of the total investment. CVRD officials are currently in talks with both federal and state governments in an effort to rectify the issue. Local taxes reportedly pose problems for other slabs-for-export projects in Brazil.