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The high taxation on imported video games goods has been blamed for Nintendo’s decision to quit the Brazilian market.
Nintendo of America told Polygon that the decision to stop shipping products to Brazil was due to "high import duties that apply to our sector". These fees could be avoided were the company to establish local manufacturing operations, although any savings would be offset be the costs involved in doing so.
Other reports suggest that prohibitive banking regulations also complicated the sale of digital games on Wii U.
Games consoles are certainly luxury products in the heavily populace country. PS4 retails for R3,999 (990) and the Xbox One (545). Taxes account for around two thirds of the cost.
"Brazil is an important market for Nintendo and home to many passionate fans, but unfortunately, challenges in the local business environment have made our current distribution model in the country unsustainable," the company said.
"These challenges include high import duties that apply to our sector and our decision not to have a local manufacturing operation. We will continue to monitor the evolution of the business environment and evaluate how best to serve our Brazilian fans in the future."
