There is little chance that the Economic Development and Fiscal Sustainability Law after the COVID-19 pandemic will be eliminated or that it ceases to be in force, even after the Court of the Admission Chamber of the Constitutional Court admitted for processing the action of unconstitutionality filed on December 13 by the assemblyman of the Unión por la Esperanza (UNES) caucus Joao Acuña Figueroa .
The law that increases income tax, especially for those with more income, and that establishes temporary contributions to companies and people with millionaire assets, It has been in force since last November 29 and expects to generate some $800 million to the treasury in the first year alone.
However, for the constitutionalist Ismael Quintana, the possibilities of an expeditious treatment are very low and even more of a retroactivity of the law. He explains that if the deadlines established in the Law of Constitutional Guarantees were strictly applied, the process in the Court should not last more than three months. “That’s the way it should be,” he says. However, in practice, court proceedings can last for years, he says.
It also maintains that traditionally, the tax issue is not a priority and this can be seen in the sense that the room that admits for processing does not make a recommendation to process the matter urgently or breaking the schemes of time. Either establishes a precautionary measure to suspend its effects.
For this reason, it considers that the procedure could take five to ten years, and if after that period it were declared unconstitutional, it would hardly be retroactive.
He bases his analysis on what has happened recently with the Environmental Promotion Law, about which the Court has just issued a ruling after ten years. The law dating from 2011 established various taxes such as bananas, bottles, among others. However, it found it unconstitutional for not complying with the principle of unity of subjects. The Court’s ruling, however, establishes that it will remain in force until 2023. in order to give the treasury time to resolve the fiscal gap that it would generate, and it does not generate any retroactivity effect.
Quintana also comments that the demands of UNES and Yaku Pérez Guartambel They have plot deficiency. They have been based on how the vote went.
The lawsuit indicates that the law in question was not approved as established in article 140 of the Constitution. They say that it was not approved, since there were 88 votes against, 19 abstentions and 30 votes in favor, as stated in the voting register of the National Assembly.
In fact, article 140 says that in the event that the Assembly does not approve, modify or deny the project described as urgent in economic matters, the President of the Republic will promulgate it as a decree-law and order its publication in the Registry. Official. It also indicates that the National Assembly may at any time modify or repeal it, subject to the ordinary procedure provided for in the Constitution.
The Assembly was unable to deny the project, since the motion to deny and file said law did not receive enough votes either. Among them, precisely the UNES caucus abstained. This gave rise to even talk of a pact between UNES and the Government.
That is why the law entered into force by the Ministry of Law.
Jaime Carrera, Executive Secretary of the Fiscal Policy Observatory (OPF), considers that this type of claim ratify the perception that already exists in the market and in the economic actors of the weak institutionality in the country and the lack of agreement and understanding of the political and social sectors on the need to have solid public accounts and a healthy economy.
Proof of this is that the country risk remains high, despite the high prices of crude oil and even the entry into force of the tax law. On the issue of constitutionality, there should be no doubt that the law is indeed constitutional, but it also considers that if there were a pronouncement of the Court, it would be ratifying the validity of the law.
For Race, The plaintiffs’ arguments only reflect the Assembly’s mediocrity, ignorance and lack of political responsibility.
About the topic, Santiago García, president of the College of Economists of Pichincha, considers that the power to file a claim of unconstitutionality is a totally legal legal tool. However, he says that the Correísta assembly members are not thinking about the consequences for the economy.
He refers that President Rafael Correa has already implemented neoliberal fiscal adjustment measures since 2015 to seek fiscal stabilization, but the economic elites did not respond with their counterpart by paying higher taxes. Now, the current right-wing government launches an aggressive tax reform that corrects this situation on the elites, and that it also adjusts to the middle class, which had already become accustomed to not paying what they owed for decades.
Explain what What the Assembly members do not fully understand is that permanent income is very important to meet the needs of the population and these are precisely generated by taxes. It is not valid to reject the increase in taxes, based on the rise in the price of crude oil. They are different things. “It has already happened to the Correa government that oil income fell due to the volatile price and they do not learn,” he said. (I)
Source: Eluniverso
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