The proposal of the President of the Republic Daniel Noboa to increase the value added tax (VAT) to 15 percent has no political support in the National Assembly. Political forces linked to the regime, such as the Civic Revolution and the Christian Social Party, expected a no vote because the tax increase represents a red line, but are open to discussing alternatives.

The two political forces have so far supported the adoption of emergency laws on economic efficiency and energy competitiveness, where even blocs like Construye and independents have cast their votes. The only sector that remained on the sidelines is Pachakutik.

VAT of 15% proposed by the Government in a new urgent project to deal with internal armed conflicts, social and economic crisis

As for this third urgent law, called the Organic Law on Suppression of Internal Armed Conflicts, Social and Economic Crisis, the Government does not have sufficient vote support, and the first reactions of the members of parliament are rejection and talk about looking for alternatives, for example, thinking about a targeted temporary contribution. the tax on the outflow of foreign currency, the collection of tax evaders and the reduction of public spending.

The emergency bill, which consists of four articles and three provisions, will be sent to the Legislative Administrative Council (CAL) for analysis and qualification. This body will determine which legislative committee will be in charge of analyzing and preparing the first report. The 30 days start on January 12.

Coordinator of the Social Christian Party (PSC), Vicente Taianohe predicted that his bloc would not vote for the introduction or increase of any tax, that although they are aware of how serious and complex the situation is, and that funds are needed to finance the war, the economic situation is also difficult for the Ecuadorians. .

Although efforts must be made, not through taxes, answered Taiano, who indicated that he does not rule out proposing some other way, as a special and immediate contribution as happened with the 2016 earthquake, although the economic situation was different, but the measures that they must be focused on taking care of people’s pockets.

For this political sector, associated with the government of Daniel Noboa, a special contribution must be defined how and to which segment of the economy, not necessarily to all, taking into account that in some cases people do not even have food to eat. In addition, the small commercial sector has been affected and its doors closed as a result of this security crisis.

His co-creator Otto Vera He also pointed out that war cannot be waged if there are no resources, and that it is clear to the state that there are economic problems. But also “we are aware that this economic problem is not only experienced by the state as such, but also by ordinary citizens, and hitting the pockets of Ecuadorians with higher taxes would be terrible, we will not support more taxes; I believe that an agreement can be reached on a temporary special contribution while armed conflicts continue.

Legislator Leonardo Berrezueta, from the Civil Revolution (RC) movement, He explained that the support for the President of the Republic, Daniel Noboa, is part of the fight against insecurity, but he believes that the order of funding priorities for this issue should be reviewed, as the last resort should be determined. % to 15%.

For this sector, also related to Nobo, there are some alternatives that should be looked at, such as returning the tax on the exit of foreign currency from the country, why not establish a special tax on banking profits, why not collect the amounts owed to the Tax Administration (SRI), tax evaders ; as well as reviewing the issue of exemption from income tax in order to have more liquidity. The one who has more pays more should be a reasonable attitude so as not to affect the already destroyed economy of Ecuadorians, he indicated.

Berrezueta said that the RC bloc does not refuse to sit down at the table, but will present its position, funding priorities and possible alternatives in these talks.

Legislator Mariana Yumbay, from the Pachakutik movement, was more radical towards the approach of the Executive and stated that they are concerned because President Daniel Noboa is again breaking his word, because during the campaign he said that he would not hit the poor and that he would not increase the VAT, and it turned out that he is now proposing a 15% increase, which is “a blow and betrayal to the people and the majority who find themselves in desperate conditions, when there are six million Ecuadorians who are on the way to poverty and extreme poverty, and on the other hand, here with the law of economic efficiency “They forgave the debts of large economic groups. “

Legislator Pachakutik believed that there are alternatives to overcome the crisis, such as charging those who earn the most, charging taxes on the outflow of foreign currency and banking, but here they do not want to touch the big power groups and end up putting their hands in the pockets of people who remain unemployed. He warned that by increasing the VAT by three points, the price will rise and Pachakutik’s votes will not be there.

Nathaly Farinango, from the government bench of the National Democratic Action (ADN)., he called on the legislators to analyze, review and respond responsibly to the proposal of the executive branch. And if the project helps solve the crisis and defend the lives of Ecuadorian families, “we are on our way,” he said. Everything undergoes analysis, and the discussion will show which alternatives can be presented, because every project can be perfected, he pointed out.

His co-host Adrián Castro He stated that this measure announced by the Government will not be permanent, as happened with the earthquake in Manabí, that victims must be borne by everyone, and even the Government itself while eliminating excessive bureaucracy. He emphasized that the law is under discussion and that it is possible to reach an agreement on a temporary measure.

The representative of the Construye bench, Camilo Salinasthey predicted that they would not support a tax increase, and said that there are alternatives for solving the crisis, such as reducing public spending.

“We will never be in favor of putting our hands in the pockets of the Ecuadorian people,” said Salinas, who said his party would deeply review the executive’s approach, as nowhere in the project was it clarified that this measure would be temporary and where the money collected would be distributed. money.

Salinas insisted that Construye would never be in favor of raising taxes, since the measure is a red line for the bloc when there are other alternatives, such as cutting the government, which the government has not proposed.

The Los Ríos representative said there were many gaps in the proposal regarding the destination of resources and who would manage them, but insisted there were alternatives to financing the war, such as optimizing the state, collecting debts from tax evaders and charging corruption.