The government does not yet have a date for sending a new tax reform, in which it would be proposed to raise the level of deduction for personal expenses to $15,200 per year.

“The President of the Republic (Guillermo Lasso) will send it in the next few days,” concluded the director of the Tax Administration (SRI) Francisco Briones when asked about the urgent economic proposal through which he would consider the reform of the regulations effective from the end of November 2021, called Organic law for economic development and fiscal sustainability after the COVID-19 pandemic.

“We are working to ensure that (the reform) is the most fair, the most balanced, the most progressive in the sense that those who do not have to pay more in terms of their low incomes do not pay as much tax compared to those who have a higher income. What we have analyzed is where there are these imbalances, these imbalances, inconsistencies. What we are designing is a plan to adjust and balance these imbalances,” Briones said this Tuesday, May 9, in the fiscal year 2022 report.

He added that the aim is to “strengthen the family economy that is affected and also identify which benefits are used by other sectors and which are not consistent. What we will achieve after the tax measures is balance or be closer to balance in terms of burden and tax pressure on society”.

The executive authority initially announced that it would send the bill on May 8, as Minister of Economy and Finance Pablo Arosemena said a few days ago. But that didn’t happen.

Briones avoided giving details about the content of the proposal or when it will be sent to him for processing in the National Assembly, specifying that the President of the Republic will make a statement about it in the “coming days”.

“The president will present it in the coming days or weeks and he will be in charge of telling them,” Briones emphasized.

The Economic Development Act effective November 2021 eliminated the personal expense deduction of up to $14,576; and currently the limit of personal expenses that is applied to the reduction of income tax is equal to seven basic family baskets; for 2023, the cap is set at $5,344.08.

In addition, among the possible changes that this tax reform would include would be a return to the previous system of income tax deduction (IR), as well as favoring those who receive income between 800 and 3000 dollars, Briones said in public statements.

This would be articulated with the family responsibilities of taxpayers, as in the case of those with an income of $2,000 or $1,500 who have no children or expenses, compared to those who earn the same amount but have dependent family members.

Briones presented his responsibility, in the cinema of the University of San Francisco de Quito, about the period of his mandate from June 2022 to April 2023, in which the goal was to reach a collection of 16,000 million dollars, but 17,000 million dollars would be achieved, he explained in explanation during the event.

The official highlighted the system of rapid tax control (PCR) which is applied, mostly, to politicians, businessmen, among others natural persons who report high incomes, but do not report tax payments to the state.

Also, that the Commission for the fight against smuggling and customs fraud was formed; and that the deadlines for refunding value added tax (VAT) have been shortened.

Although he did not present the numbers of users or the amounts, he gave an example that before the VAT refund took six months, but now it takes one month.