Norsk Hydro ASA has expressed concern that a new Brazilian sales tax on fuel oil will impact their bauxite and aluminum business in the northeast state of Para to the tune of $24.5 million per quarter starting February 1.

To date, Para’s aluminum industry has enjoyed a deferral of the tax, known as an ICMS, with a reinstatement pending Q3 2015, noted officials at the Norwegian company; an exemption on intra-state goods and services purchases was to follow.

Executive Vice President and head of Bauxite and Alumina Johnny Undeli said that, in light of “sudden changes in tax legislation, we are doing what we can to try to get the decision reversed.” Moreover, “we need predictable framework conditions,” he added.

In a similar 2012 ruling, later reversed, Alunorte temporarily paid ICMS taxes on fuel oil from Q1 to Q3. In addition, Hydro and its electricity supplier have agreed to pay ICMS levies on power purchases by the Alunorte and the Paragominas bauxite mine.

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