Have you ever wondered if there are any states in Brazil where cars are cheaper? This is something to consider, since it's no secret that Brazilian vehicles are among the most expensive in the world. 

Therefore, it's common for many consumers to look for regions where cars are cheaper. But is leaving your state, your city, and going to another place to buy a vehicle a good idea?

Ultimately, with high taxes going to the government and automakers increasing their profits, even if they don't admit it, the final burden always ends up falling on the customers.

Considering models that come from abroad, the costs become even higher due to importation. This is because, when they arrive in Brazil, it's necessary to pay IPI (Tax on Industrialized Products), ICMS (Tax on Circulation of Goods and Services), in addition to PIS/COFINS (Social Integration Program/Contribution to Social Security Financing) which are destined for INSS (National Institute of Social Security). 

And finally, there's the infamous IPVA (Vehicle Property Tax) and licensing fees, which also add value to the car. However, the good news is that it's possible to get around the prices and buy a car in another state!

Today we're going to show you the state where cars are cheapest in Brazil and whether it's worth going there to make your purchase! So, let's check it out?

When you discover that there's a state in Brazil where cars are cheaper, your automatic thought is: I'm going there to buy my car!

After all, if it's cheaper there, I'll only pay for the travel and guarantee a much more affordable price! In theory, this is quite functional! However, in practice, it doesn't work that way. 

Just as many people resort to the famous Brazilian "jeitinho" (a way of getting around rules or bending the rules) to get out of negative situations, companies and the government also find their own loopholes. So, although the idea is valid, it unfortunately doesn't work.

As we've mentioned many times, when it comes to buying vehicles, the final cost always ends up falling on the consumer. So, we're going to show you now why it's pointless to buy a car in another state. 

According to information from the Special Communications Office of the Ministry of Infrastructure:

"There is nothing in the Brazilian National Traffic Code (CTB) that prevents the purchase of vehicles in a state other than the buyer's state of residence."

However, there is a problem. At the time of vehicle registration, proof of residency in the federative unit will be required. Article 120 of the Brazilian Traffic Code states that:

Every vehicle must be registered with the state or Federal District traffic enforcement agency in the municipality where its owner is domiciled or resides, as required by law. 

Therefore, you can buy the vehicle in any state, but you will need to register the car in the state where you live. The problem is that attempts to evade these fees end up being thwarted! 

Even if you buy a car in another state, you still need to pay the ICMS tax in your own state! 

For example: if you live in São Paulo and buy a car in Minas Gerais, when you register the vehicle in São Paulo you will have to pay the ICMS tax related to the state of São Paulo. 

To understand the situation once and for all, our experts spoke with a tax lawyer. 

In the conversation, we discovered that after the creation of the differential tax rate on sales to the final consumer, which was established by Constitutional Amendment 87/2015. 

Thus, according to the amendment, senders of products sold to other states now have to pay the difference between the tax rate for a given product and the ICMS (Value Added Tax) of the final destination. 

Let's use the example of Minas Gerais and São Paulo again. Even knowing that cars are cheaper in Brazil, if someone from São Paulo buys a car in Minas Gerais, the following happens:

The seller pays the ICMS (Brazilian state sales tax) portion of the origin to the government of Minas Gerais and the difference between the tax in São Paulo and Minas Gerais to the government of Minas Gerais. 

Therefore, the final tax burden is that of the destination state. In other words, in practice, you can't buy a cheaper car in another state and bring it to use in your home state. 

Although this is a relevant and important question, as we have just shown, unfortunately buying a car in another state to take home doesn't work! 

So, we're going to show you now the state where cars are cheapest in Brazil. 

Although São Paulo has the highest ICMS (a Brazilian sales tax) in the country, the state, and especially its capital, is considered today the best city to buy a vehicle. 

This is due to the large number of dealerships and a very high demand for vehicles. Furthermore, there are brands and manufacturers that only sell vehicles in the state of São Paulo. 

Thus, high demand ends up leveling prices and making the values in the state more accessible. Therefore, if you are looking for a special vehicle, know that you will find it in the state of São Paulo. 

Continuing our search for the state with the cheapest cars in Brazil, we have the northern region. The good vehicle prices in the northern region are driven by the Manaus Free Trade Zone. 

The Free Trade Zone generates a series of partnerships that lead to incentives in the region. Therefore, it is very common for specific vehicles, such as pickup trucks, which are widely used in the region, to be exempt from ICMS (state sales tax) and IPI (federal excise tax), for example. 

However, as we just showed you, there's no point in going all the way to Manaus to buy your cheapest pickup truck. Besides the tax difference, you'll have to pay a high shipping cost, making the deal unfeasible. 

And finally, we have the South, Northeast, and Midwest regions. In the states of these regions, we have an interesting situation! There are many vehicle factories, however, there are few dealerships in these locations. 

This specific point automatically causes vehicles to be produced in other locations and transported there by land. 

Thus, with the need to pay for fuel and tolls, vehicles end up becoming more expensive due to freight costs. And naturally, this extra cost is passed directly on to the final consumer! 

When we take into account taxes, fees, and partnerships, the best state to buy a vehicle today is Amazonas!

Due to the presence of the Manaus Free Trade Zone and tax partnerships, Amazonas is the state where cars are cheapest in Brazil. But as we've shown you, there's no point in going all the way there to buy your car! 

Looking at the rest of the country's states, even with different ICMS (a Brazilian sales tax) rates per state, in general, vehicle prices don't fluctuate much in Brazil! 

So, if you're looking to save money, the best approach is to follow the old logic: do your research, be patient, and if possible, pay in cash to get some kind of discount! 

Now that you know which state has the cheapest cars, we have another revelation for you. After much research and conversations, we've created special content with the truth about car prices in Brazil!

Want to know why cars are so expensive here? You can find the answer at the link below!