Productive sectors propose fiscal pact in the tax reform of the Executive

On the second day of appearances, the legislative committee for Economic Development of the National Assembly received representatives from the productive sector and business associations who presented their observations on the urgent project for Economic Development and Fiscal Sustainability, which focused on the implementation of new tax burdens. to the patrimony, the tax table and the elimination of the deductions, reason why they raised a fiscal pact.

The project highlighted the elimination of VAT and ICE for some consumer products, although the representative of small and medium-sized companies proposed the inclusion of inputs for production.

The appearances will continue next Monday with the presence of the government economic authorities from 09:00, whose session will be in person and cannot be delegated, announced the legislator, Wilma Andrade, who is in charge of presiding over the table.

In the session of this November 6, unanimously, the commission approved a motion raised by the legislator César Rohón (former PSC), so that the technical support table made up of economic representatives of the government and the legislative commission, be included also delegates from the productive, academic and citizen sectors.

Minister Simón Cueva highlights the importance of tax reform to reduce deficits and give more resources to GAD and universities

Felipe Ribadeneira, president of the Ecuadorian Business Committee, pointed out that the new contribution to companies that is proposed in the project should be rethought because it compromises the reactivation capacity, and also said that establishing a higher tax burden on households impairs consumption and formalization capacity tax, for which he raised the need for a fiscal pact that encourages legal security, reactivation and investment.

He said that it is necessary for tax reform to be in tune with the economic moment to protect jobs and especially the sources that generate employment.

That taxing the patrimony is antitechnical, since the reform does not distinguish between companies that have losses with companies that have a low level of liquidity.

This fiscal pact, according to Ribadeneira, will allow obtaining legal certainty which will encourage the attraction and generation of investment, tax planning with co-responsibility.

In this pact, the State must demonstrate a responsible management of public resources, the tax system must encourage simplicity, formality and economic reactivation, and there must be an efficient management of spending and the public procurement system.

The president of the Quito Chamber of Commerce, Carlos Loaiza, highlighted as positive of the project the power that the President of the Republic will have to reduce VAT on holidays, in the tourism sector; as well as the power to reduce the ICE. He also highlighted the elimination of VAT and ICE on some products and services; the elimination of the payment of inheritance tax to beneficiaries within the first degree of consanguinity and to surviving spouses; Likewise, the inclusion of tax mediation mechanisms.

Criticisms of the project from the CCQ, are in the chapter of the wealth tax, since they consider that the main affected are in the commercial and industrial sector who assumed more than 50% of the losses in 2020. That the reform not only It hits large companies, almost 20% of companies are SMEs, this is 550 companies.

Miguel Ángel González, president of the Guayaquil Chamber of Commerce, proposed that the urgent Law consider including a reduction of ICE to weapons so that private security companies can become stronger and join efforts in the fight against crime, insecurity citizen and violence in general.

The Council of Chambers of Production through its president, Felipe Espinosa, indicated that the contributions that arise in the project must be temporary and must not compromise the liquidity of the companies, otherwise the economic reactivation and the generation of employment they are going to take much longer. The increase in income tax should not be more than two years, and the deduction of expenses should be maintained at least in the most important items such as health and education, he noted.

On the issue of property tax, the Council of Chambers considers that there should be a differentiation in agricultural lands and urban property, likewise there should be a different table in each of the taxes.

Gabriela Borja, president of the Chamber of Small and Medium Enterprises of Pichincha, stated that small and medium-sized enterprises (SMEs) need the support of the country to maintain the 60% of job creation that this sector contributes, as many face debt Therefore, he proposed the inclusion of low-rate loans and refinancing of debts that they maintain with the IESS and the SRI.

On the other hand, Víctor Murillo, vice president of the Foreign Trade, Customs and Investment Commission said that the project is very positive in general because according to the objective of the proposal is to provide fiscal sustainability, but for public finances to be sustainable, the private sector In the future, it must have contributory capacity, but likewise there must be a refund from the State. (I)