U.S. trucking companies oppose new bill of lading tax; U.S. trade deficit widens in 2021; Global foam market to expand 4.8% annually; ACC supports U.S. infrastructure revamp; Brazil's chemical industry may face higher taxes; Braskem buys back bonds
U.S. trucking companies oppose new bill of lading tax
The American Trucking Associations said on June 23 that it opposes any proposal for a new bill-of-lading tax “as a pay-for solution to our nation’s infrastructure needs.”
The umbrella group of U.S. trucking associations said that to add a tax per bill of lading, a document between shipper and transportation company that details rate, goods to be transported and destination, would be “essentially a sales tax on commercial truck transportation” above all impractical.
“A bill of lading tax requires collection from hundreds of thousands of tiny entities. The costs of enforcement, processing, collections, training and other regulatory initiatives, just to name a few, would be astronomically greater” than alternatives, it said.
“All of these issues not only create significant opportunity for evasion, but they also lead to endless litigation and have the potential to create market distortions between for-hire and private carriers that could be disruptive to the U.S. supply chain,” it said.
U.S. trade deficit widens in 2021
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis said on July 2 that the goods and services deficit was $71.2 billion in May, up $2.2 billion from a revised $69.1 billion in April.
The May increase in the goods and services deficit reflected mostly a rise in the goods deficit of $2.3 billion to $89.2 billion, according to the U.S. Census Bureau.
Year-to-date, the goods and services deficit increased nearly $111 billion, or 46%, from the previous year. Exports rose nearly $102 billion, or 11%, while imports increased $213 billion, or 19%.
The detail shows the biggest change in May was an increase in imports of goods by $2.7 billion to $234.7 billion. Industrial supplies and materials imports increased $2.6 billion.
Considering 2012 dollars, the real goods deficit increased $3.1 billion to $101.8 billion in May. Real exports of goods decreased $3 billion to $145 billion while the real imports of goods increased $0.1 billion to $246.8 billion.
Global foam market to expand 4.8% annually
The global foam market, including polyurethane, polystyrene, and polyolefins, will reach nearly $120 billion by 2026, or see 4.8% annual growth from current levels just under $94 billion, said ResearchAndMarkets.com on June 28 in a press release through PRNewswire.
“The market is propelled by the growth of various end-use industries. Increasing investments in infrastructure, new housing projects, and renovation of non-residential buildings in China, India, and Brazil have also boosted market growth,” it said.
Foam has seen rising demand from automotive, construction, and footwear. Products containing foam have diverse uses ranging from recreational like surfboards, to furniture.
The largest segment of the foam market is polyurethane. Methylene Diphenyl Diisocyanate (MDI), Toluene Diisocyanate (TDI), and polyester polyols are the main intermediates to make polyurethane . Polyols with TDI produce flexible foam while converter seeking to produce rigidness seek polyols with MDI.
Chemical companies support U.S. infrastructure revamp
The American Chemistry Council stressed on July 1 the importance of the advance in the U.S. House of Representatives of infrastructure revamp plans through the approval of the Investing in a New Vision for the Environment’s initiative.
“In addition to providing $715 billion for physical infrastructure improvements, the legislation will reauthorize the Surface Transportation Act” set to expire at the end of September,” according to the statement released after the passage of the bill.
“The U.S. business of chemistry will be central to the rebuilding effort since we depend on and contribute to a stronger and better infrastructure,” it said. The association also urged members of the Senate to promote advanced construction materials when considering the approval of the bill.
Brazilian chemical industry may face higher tax bill
Brazilian legislators have moved toward eliminating a special tax treatment for the chemical industry as the government seeks ways to fund a plan to slash levies on cooking fuel and diesel, Brazilian media G1 Globo said on June 2.
Changes were dependent at the time on final congressional approval within a 120-day period.
According to the provisional legislation approved in March, the government was set to eliminate starting July 1 a special tax treatment for the chemical industry known for its acronym Reiq that reduced taxes on petrochemical feedstock.
The tax changes on the chemical industry would represent 667 million reais in 2021, 1.4 billion reais in 2022 and 1.5 billion reais in 2023, according to the government, G1 Globo added. The legislation calls for gradual changes over a four-year period.
($0.20 = 1 real)
Braskem buys back bonds
Latin America’s biggest petrochemical company Braskem said on June 17 in a filing to Brazilian stock authorities that a subsidiary in the Netherlands tendered and accepted nearly $234.5 million in total for a bond buyback.
The transaction included $164 million due in 2041 and $70.5 million due in 2023, it said.
Braskem’s owners Odebrecht (changed named to Novonor in December) and state oil company Petrobras have separately disclosed plans that they will eventually prepare a sale of up to their entire participation in Braskem.
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