In a review of commerce published in May, 1916, the Jornal do Commercio said that out of the ninety-four classes of Brazilian manufacture, eighty were free from internal taxes (the “imposto do consumo”) while fourteen were subject to tax, as well as to foreign competition.
It was demonstrated that in these fourteen classes Brazilian manufactures fell below fifty per cent of the total consumption in only one instance, that of pharmaceutical specialties. The most important items are these, in round numbers:
| Brazilian-made | Imported | ||
|---|---|---|---|
| Woven fabrics (chiefly cotton, but some silk and wool) | 450,000 contos | 47,300 contos | 82 |
| Beverages (mineral waters, beer, wine, spirits) | 101,300 contos | 47,640 contos | 68 |
| Footwear (leather shoes and boots, and alpagartas) | 150,225 contos | 2,425 contos | 97 |
| Prepared tobacco, cigarettes and cigars | 39,000 contos | 1,565 contos | 96 |
| Hats | 29,000 contos | 3,800 contos | 86 |
| Matches | 18,000 contos | 4 contos | 99.9 |
| Conserves | 13,300 contos | 9,800 contos | 58 |
| Pharmaceutical specialties | 11,700 contos | 15,780 contos | 43 |
In 1921 the number of home-made goods paying imposts rose to 21, and the value to well over one million contos, and includes, besides those detailed above, vinegar, walking sticks, salt, candles, perfumeries (of which Brazil makes sixty per cent of the consumption) and playing-cards.
Among the large class of manufactures free from internal taxes are the important items of cotton thread, jute products (rope, cord and coffee bags) the products of ironworks, potteries, furniture factories; goldsmiths and jewel-workers, soap makers, paper and paper-bag factories, biscuit and bottle, shirt, mirror, trunk, ink, pipe, pin, and window-glass makers; but all of these pay a contribution to their State or municipality or both, appearing in revenue lists under “Industrias e Profissões.”
In the city of São Paulo this tax upon industries and professions, the latter list embracing bankers, lawyers, barbers, shoe-shiners, hotel-keepers, doctors, newspaper sellers and so on with true democratic impartiality, brings in over forty per cent of the municipal income; it is now worth some three thousand five hundred contos a year, or let us say nine hundred thousand dollars, the cotton factories paying the biggest item, twelve thousand dollars, while shoe factories, jute mills, potteries, jewellers, furniture makers and metal works each pay about eight thousand dollars.
It is plain that manufacturers do not have things all their own way in Brazil, and must be prepared for fairly heavy taxes, but one does not hear the same complaints about petty taxation for every trifle as in the Argentine; on the other hand, the mill owner has not to face cut-throat competition as in older manufacturing countries, is able to get an excellent price for his products, is able to buy land at inexpensive rates and to obtain comparatively cheap labour. As soon as a district becomes thickly sown with factory chimneys prices of land and labour automatically rise, of course; this natural law has operated already in the now densely populated and built over suburbs of São Paulo, Braz and Moóca, and is, under one’s eyes, transforming the windy upland flats of Ypiranga. A year or two ago much of this area was red clay swamp, with a cottage here and there and a few Italian market gardens producing vegetables for the city dwellers, and land could have been bought for ten milreis an acre or less; today it is worth from two hundred to five hundred milreis; the wet lands have been filled in, an enormous undertaking, rows of workmen’s houses extend for miles to the crest of the hill where the Monument stands commemorating the Grito da Independencia, and from its summit one has a view that is mottled with factory smoke and punctuated with tall chimneys. To see this and to watch the crowds of pretty chattering Italian girls pouring out of Braz and Moóca factories at noon or evening is to obtain a revelation of the newer South America. It is no longer a land of sugar and brazil-wood only and although the agriculturist may shake his head over the lack of hands on the farm, manufacture in Brazil is a live, energetic phase of her modern development. São Paulo City was employing, by the end of 1921, over twenty-five thousand horsepower of electrical energy in her factories.
The fabric-weaving factories in all Brazil, including cloths of cotton, jute, linen, silk and wool, were 303 in number in 1914, employing 75,000 workpeople and capital totalling over 368,000 contos of reis; in 1920 they had increased to 328 including 242 cotton mills which alone employed 109,000 hands. The premier producer of cotton cloth in 1920, in values, was Rio de Janeiro (Federal District) with an output worth 102,000 contos; next came S. Paulo State, 92,000 contos; then Minas Geraes, 91,000; Rio de Janeiro State, 46,000; Bahia, 32,000; Pernambuco, 21,000; Alagôas, 16,000; Sergipe, 12,000; Maranhão, 11,000; Rio Grande do Sul, 9,000; Ceará, 3,000; and Piauhy, Rio Grande do Norte, Paraná, Parahyba and Espirito Santo, about 1,200 contos each. The States absent from cloth manufacturing returns are the great forestal territories of the extreme north, and those of the vast interior uplands, where conditions are not greatly changed from the time prior to the Portuguese discovery so far as development is concerned.
In numbers of mills São Paulo again comes first with seventy-eight mills making cloths: fifty-five of these weave cotton alone, leaving a higher proportion of fabrics made from other materials than in sister States; generally speaking cotton cloths occupy the greatest share of capital and labour, as for example in Minas, where sixty fabricas de tecidos operate, and out of the total value of the production, 23,500 contos, cotton accounts for over 22,600 contos. With a larger number of cotton-cloth mills at work than S. Paulo, but with production worth not much more than one-fourth, it is clear that factories are very much smaller in the interior State; nevertheless, she is able to pride herself upon a thriving industry, occupying nearly nine thousand people, twenty-five thousand contos of capital, and using ten thousand tons of raw cotton. In common with the other weaver States of the Brazilian Union, Minas ships her cloths to less industrially developed regions: in this connection some light is shed upon the ramifications of finance cum industry by the President of the Sociedade Mineira da Agricultura (Minas Society of Agriculture), Dr. Daniel de Carvalho, in an address at the Cotton Conference held in Rio in June, 1916. Stating that the Minas export of cotton cloth (to other States) was nearly 28,000,000 metres in 1915, he showed that, at an average price of four hundred reis (eight cents) a metre, the total value was more than eleven thousand contos: but in the official statistics the value of exported cotton cloth appeared as only 3,893 contos. “This anomaly is an example of the regimen of fiction in which we live, from the taxation point of view. The Minas legislator votes for high and sometimes excessive taxes,—and the Government in a fatherly manner corrects the excess in calculations of ad valorem percentages, accepting a benign interpretation of merchandise values. Instead of products appearing with exaggerated values we find on the contrary that most estimates are well below the real amount, as in the case of manganese....” The cure for this deliberate lessening of values, which certainly does Brazil poor service, would be, said Dr. Carvalho, an all-round diminution of tribute, together with a rigorous application of the law.
In the Federal District the number of weaving mills is thirty-five, several clustering in the mountain valleys of Petropolis and deriving power from waterfalls; the State of Rio has twenty-seven; Santo Catharina, fifteen; Bahia and Maranhão have thirteen each; Rio Grande do Sul, twelve; Ceará and Alagôas, ten each; Pernambuco, nine; Paraná and Sergipe, eight each; Espirito Santo, three; Rio Grande do Norte, Piauhy and Parahyba, one each.