A small plane carrying 10 people crashed into shops in the centre of the tourist city of Gramado in southern Brazil on Sunday, killing everyone on board, state government officials said.

The aircraft's owner and pilot, Luiz Claudio Galeazzi, died along with the other nine passengers, all of whom were members of his family, according to Rio Grande do Sul Governor Eduardo Leite.

In a statement published on LinkedIn, Galeazzi's company, Galeazzi & Associados, confirmed that the 61-year-old was on the plane, adding that he was traveling with his wife, their three daughters, several other family members and another company employee, who perished in the crash.

In addition, 17 people on the ground were injured, Leite said at a press conference, with 12 still receiving hospital care, including two in a critical condition.

Manufactured in 1990, the twin-engine Piper PA-42-1000 took off shortly after 9 am local time from nearby Canela airport and was heading to Jundiai in Sao Paulo state under unfavourable weather conditions, the governor said.

He noted that the cause of the crash is being investigated by the Aeronautical Accident Investigation and Prevention Centre (Cenipa).

Nestled in a mountainous region, Gramado is the most popular tourist destination in Rio Grande do Sul, which was severely impacted earlier this year by unprecedented floods that claimed dozens of lives, destroyed infrastructure and significantly disrupted the state's economy. (Agencies)