Restrictions against the use of weapons in Brazil reduce Taurus profits

Taurusthe largest manufacturer of revolvers in the world, reported this Tuesday that its profits fell 72.4% until September, weighed down by the new restrictions on weapons imposed by the Government of Luiz Inácio Lula da Silva in Brazil.

The accumulated profits in the first nine months of the Brazilian manufacturer stood at 399 million reais (about US$ 82 million), according to a statement sent to the stock market.

The company’s net turnover amounted to 1,362 million reais (about US$ 279 million) until September, with a decrease of 28.8% compared to the same period last year.

The main reason for the company’s poor performance was the market in Brazil, where on January 1 Lula succeeded Jair Bolsonaro, who had provided legal facilities for the possession and use of weapons by civilians.

Sales in Brazil sank 77.1% in the accumulated of the year, something that the company attributes to the “uncertainty” which caused the new Government to take seven months to publish the decree with which it regulated the sector, restricting the sale of weapons of various calibers.

Taurus stated that it will quickly adapt to the new legal requirements and announced that at the beginning of 2024 it will launch new versions of the G2C and GX4 compact pistols to comply with the new regulations.

Last July, the Government limited the number of weapons that citizens can own and also prohibited the sale of certain calibers, now considered restricted use.

Last week, the Brazilian government also announced a sharp increase in taxes on the sale of firearms and ammunition.

Whoever wants to buy a pistol or revolver will pay a 55% in taxes (before it was a 29.2%) and for ammunition, the rate went from 13% to the 25%.

The drop in arms sales was not limited to Brazil; in the United States, Taurus’ main market, they fell a 33% through September compared to the same period the previous year, which was a year of strong sales after the pandemic.

Taurus attributed this drop mainly to a trend of stock reduction by retailers, although it indicated that purchase intentions are at historical levels.

The manufacturer also appreciated that “The war in the Middle East tends to create greater movement in the sector, with the possibility of a natural increase in demand.”