The Brazilian government announced Monday that it plans to crack down on Asian e-commerce giants, as part of a broader tax reform.

The country's Finance Minister Fernando Haddad said the crackdown is aimed at addressing complaints from local retailers about unfair competition from global players, including Shein, AliExpress and Shopee, Reuters reported.

The measure, aimed at combating certain global players that hide their e-commerce as person-to-person remittances to avoid paying taxes, could generate up to 8 billion reais ($1.5 billion) in new revenue for the government.

Brazilian retailers have long been concerned about the local presence of these companies, as they are flooded with Chinese sellers who sell low-priced and competitive goods to Brazilian consumers.

In 2022, the Retail Development Association (IDV), which represents 75 local retailers, has organized a campaign that could result in a series of actions against online marketplaces that, in their opinion, sell counterfeit products or are not properly taxed.

IDV's document calculates between 19 and 20 billion reais in tax evasion on sales by international retailers in 2020 - 80% to 90% of which come from Asia. Among Brazilian chains, this tax evasion is between 4 billion reais and 5 billion reais.

According to Reuters, the government plans to release the measure by next week, together with legislation for its fiscal framework.

The Brazilian e-commerce market is expected to grow at a CAGR of 10.23% during the forecast period 2022-2027.

According to data intelligence firm AgenciaePlus, the five most visited online stores in Brazil, the largest economy in Latin America and the fifth largest country in terms of population, in 2022 are Mercado Livre, Shopee, Amazon, Americanas and Magalu.