A Brazil-made iPad has been in the offing since July 2011. However, plans by Taiwan’s Foxconn to build the tablet in South America were held up by negotiations surrounding taxes that could double the cost of Apple’s tablet. Now comes word the government has exempted the iPad, freeing Foxconn to begin churning out iPads stamped “Made in Brazil.”
The tax issue was an important hurdle to overcome as they raised the cost of Apple doing business in Brazil as well as hiked the price of Apple products for South American consumers. The tablet and other keyboardless devices weighing less than 750 grams will forego Brazil’s Excise Tax, Social Contribution Tax and Federal Contribution Tax, according to the Portuguese-language news site FOLHA.
In September, Foxconn decried the taxes, warning they could threaten the $12 billion deal to build iPads in the South American country. The agreement, announced Monday in the Brazil’s Inter-Ministerial Decree 34, apparently suggests the parties have settled their disputes. A government minister in 2011 was quoted as calling Foxconn’s concerns as “crazy demands.”
The deal could also be seen as relieving some pressure from both Foxconn and Apple. The Cupertino, Calif. company was recently criticized for the working conditions at plants run by Chinese suppliers. Apple CEO Tim Cook refuted a New York Times front-page article about how iPhones are built, saying he was “outraged” about the report which he described as “offensive” and “patently false.”