Range i possible conflicts of interest which could give remission of finessurtaxes and interest on tax obligations was the topic that the parliamentarians discussed the most in the first discussion of the draft law on economic efficiency and job creation, promoted by Daniel Noboa’s government.

The plenary session of the National Assembly began its debate on Tuesday, December 12 at around 4:30 p.m., and 131 deputies were present and 6 were absent. The session analyzed the content of the report, which was unanimously accepted by the Committee for Economic Development, which is responsible for processing the proposed law.

The speaker of the project was Member of Parliament Valentina Centenochairman of the Commission for Economic Development and coordinator of the ruling ADN party.

Centeno pointed out that the report includes more than a hundred observations from various public and private sectors and several proposals were accepted of different legislative blocs. “Expectations are very high, Ecuador is looking for results and it is our obligation to deliver them,” he said.

He emphasized that The standard has three objectives clear: strengthen employmentattract investments and promote a collection in order to be able to cover part of the fiscal deficit assumed by the Government.

Regarding the first point, Centeno emphasized that the standard proposes that companies that hire new staff, even if it is one new worker, will pay less income tax, through an additional allowance for wages and salaries. That the benefit increases if young graduates of public schools or colleges or young people who get involved in construction and agricultural projects are employed.

He noted that interest and penalty waivers are being proposed for those who have been unable to pay their education loans.

The VAT refund will be made on the purchase of construction materials, which will make access to residential buildings cheaper and increase employment. And the 2022 single installment of income tax for popular companies will be forgiven, benefiting more than 1.8 million companies.

In order to attract investments, the parliamentary representative stated, will strengthen the public-private partnership (PPP) regime., in order to strengthen public works. He explained that public services that are constitutionally free and that can be developed through APP cannot be charged to the user, but the costs are borne by the state. And privatization is prohibited.

except free zones will be introduced which will provide an income tax rate of 0% for the first five years and then have a flat rate of 15%. That the economic development zones (ZEDE) will remain in their current conditions, but there will be relief for those investors who want to move from the ZEDE to the free zone.

Free zones will enable the development of economically depressed places, as well as strategic areas.

As for the billing, Valentina Centeno assured that “the bill it does not mean a big package for the pockets of Ecuadorians.”

He indicated that two measures are proposed in this regard. The first is a monthly self-retention for large taxpayers, depending on the sector; In other words, agriculture, livestock and fisheries will not have the same level of self-sustainability as the oil sector.

The second measure is waiver of interest, fines and additional fees for obligations with the Tax Administration (SRI). He explained that this will apply to all taxpayers: large, medium and small. This will benefit more than 293,000 taxpayers who currently have outstanding accounts with SRI.

“We have the ability to help 1 in 10 Ecuadorians who currently have a fine or interest from the SRI,” he said, repeating his call for the bill to be approved.

The Government strives for a tax amnesty, that is, an amnestyraise $960 million in 2024. The draft law sent by the Executive does not contain specific parameters or delimitations. Openly targets all taxpayers with outstanding interest, penalties or additional fees with SRI.

Because of this, several members of the assembly raised their voices to present theirs concerns and proposed proposals for regulating this point of the standard.

One of them was Sandra Rueda, from the Construye movement. In his opinion, the legal body does not represent long-term solutions for the country’s economic problems, but rather worsens them.

He said that in order to avoid a conflict of interest, tax amnesty should exclude to members of the Government, the National Assembly, government officials and their families.

In this sense, he suggested that a general provision be introduced into the law, which establishes that “no legal entity that has corporate relationship with the president or vice president of the Republic, state ministers and officials in the same rank, members of parliament and directors of public companies or with their relatives up to the fourth degree of consanguinity or the second degree of consanguinity.

From the bench of the Civil Revolution (RC), Viviana Veloz, the first vice-president of the Assembly, congratulated the work of the Commission for Economic Development. However, he commented that the bill “short-term solution” and made several observations and suggestions to include.

He suggested that the SRI make transparent information about economic groups that benefited from previous tax breaks, because “it would not be fair” for them to benefit from the amnesty again. He emphasized how important it is avoid conflict of interest. This is where tax evasion must be avoided and prevented because it takes away funds from the state.

In order to get more, Veloz suggested that they believe in the law extraordinary taxes on banking profits, sector pharmacist and according to mobile phone companies; establish a temporary or final tax on large economic groups; establish a 3% tax on those who have real estate or real estate in the tax havens; incorporate a tax exemption for the agricultural sector. And the Monetary Code was amended so that part international reserves.

On other issues, Vicente Taiano of the Social Christian Party (PSC) congratulated the Commission for removing the income tax from the occasional sale of real estate from the bill, but warned that additional regulatory changes were needed to remove the tabular tax system created former president Guillermo Lasso.

He pointed out that the incentive for companies hiring new staff should not be limited to young students from public institutions, but should also be extended to the employment of young people from private schools and colleges.

Prior to Taian’s intervention, the PSC and allied bench released five notes on measures to be considered in the bill. In addition, the bloc indicated its support for the legal body.

Around 8:40 p.m., the Speaker of the National Assembly, Henry Kronfle (PSC), closed the session after 18 MPs intervened. The bill will now return to the Economic Development Commission to continue analysis before a second and final reading.

The norm was submitted to the Parliament on November 27. Since the text is urgent in economic matters, the Assembly has 30 days to process and resolve its acceptance or rejection until the end of the year.