Repeal of the tax law passed to the commission for its analysis and report of the first debate

The General Secretariat of the National Assembly notified the Economic Development Commission with the qualification of the two projects that propose the repeal of the decree-law through which the Economic Development and Fiscal Sustainability Law entered into force after the COVID-19 pandemic, containing the new tributes.

The projects were presented by legislators Patricia Sánchez, Ángel Maita and Salvador Quishpe, from the Pachakutik movement, and Assemblywoman Viviana Veloz, from the Unión por la Esperanza (UNES) caucus.

Qualified two projects that seek to repeal the tax law that created new taxes

The qualification was given after the struggle between the political forces that act in Parliament, where the government sector and its allies tried to block the qualification by proposing that the Constitutional Court be consulted first if the National Assembly can repeal an urgent economic law that entered into force by decree-law due to lack of pronouncement of the Legislative.

That decision, initially taken by the Legislative Administration Council (CAL), heated up the spirits of the UNES, PSC and a sector of Pachakutik, which even threatened to carry out an evaluation of the CAL, for failing to fulfill its functions in the non-qualification of these two bills subject to article 140 of the Constitution.

The plenary session of the Assembly denied the previous qualification to consult the Constitutional Court and ordered that the CAL qualify the two projects so that they can be processed through ordinary channels.

To give way to this qualification, the CAL pointed out that despite the fact that the non-binding report of the Legislative Technical Unit of January 3, 2022 indicates that the projects do not meet the formal requirements prescribed in the Constitution and in the Law of the Legislative Function, the procedure provided for in the third paragraph of article 140 of the Constitution has the purpose of establishing a mechanism of checks and balances between the Executive and Legislative functions, so that the latter can modify or repeal at any time a law that does not was issued in a conventional way, but through an exception mechanism, such as the promulgation of the bill with urgent classification in economic matters as a decree-law.

Patricia Sánchez, one of the legislators who proposed the repeal, argued that the tax law in force puts the weight of collection on the middle class, since any employee, whether public or private, sees a monthly tax reflected on his salary, as well as on small merchants with the Simplified Tax Regime (RISE). Which affects the economies of Ecuadorians.

That with this law the forgiveness and forgetting of all the resources that are outside the country in tax havens is sacramented, since the law establishes a secrecy on that information.

The Pachakutik movement, in its last political council, decided to vote organically for the repeal of this bill, Sánchez said, after pointing out that although the Executive will have to pronounce on these projects, it will have to analyze very well.

Regarding the procedure in the Development Commission, the national legislator of Pachakutik pointed out that she can sense that a report would come out recommending its filing, because “it is observed that this legislative table is very attached to the form of the government of Guillermo Lasso, because when it processed the two reports on these tax reforms received his approval and delivered a positive majority report.

The project presented proposes to repeal with immediate effect the decree-law that promulgates the Organic Law for Economic Development published in the Third Supplement of the Official Gazette No. 587 of November 29, 202. According to the proposing legislator, the only thing that the commission is to establish a report where it indicates whether or not it accepts the bill.

The Economic Development Commission must know and open the socialization phase to legislators and citizens through the web portal. And within a maximum period of 90 days, you must present a report for the first debate. (I)