The Tax Administration (SRI) lowers the self-confidence of “provincials”. It does so by publishing data on collections by territory that devalue its actual contribution to the national treasury. And this, despite the warnings from this column, about such underestimation.
In April 2005, a forum on autonomies was held in which about a thousand people participated. The speakers were former president of the Autonomous Community of Catalonia (Spain) Jordi Pujol; the then mayors of Quito, Paco Moncayo, and Guayaquil, Jaime Nebot, and me. Until that day, SRI assigned all customs collection to Guayaquil simply because it, as a port, was the point of collection. For my part, I presented many figures to the forum, among them the actual territorial breakdown of customs taxes, thanks to the RUC of each import that I extracted from the Corpei database. The director of the SRI was among the audience and they soon stopped assigning customs duty to Guayaquil: they placed it according to the origin of the buyer (importer), which gave the geographic port accident a more real economic meaning.
But SRI did not do the same with other taxes: VAT not related to imports continued to be declared by the seller, until now. This has led to some politicians (eg Yunda in a letter to this newspaper) and some capital tweeters bragging about contributions from other people’s pockets and whining about unrealistic contributions.
The question is not vanity, since the Central Bank prepares national accounts using information from the SRI; and cantonal and provincial GDP (GRP) are affected by this distortion. In 2018, technocrats from the Ministry of Finance decided to calculate COOTAD allocations by lowering the importance of population to 5% and raising the importance of “fiscal effort” to 25%, giving Quito an allocation of $10 million, which was reduced in Guayaquil. Then I complained to the mayor and Nebot (in the ministerial agreement) got a refund, not only for Guayaquil, but also for many cantons in the country.
Noting that SRI directors have (finally) come from Guayaquil, in July 2022 I visited the regional director and asked him to provide information correcting the territorial origin of the fiscal effort and, after 14 long months, SRI has just released a “Preliminary Study” in which, after decades of inaccurate records, the provincial tax contribution is no longer calculated according to the place of residence of the collector, but according to the place of generation of the economic event, that is, who pays the tax. And, as expected, due to the administrative accident in the capital, Pichincha turned out to be the province that fell the most when correcting contributions, which in 2022 turned out to be $1,553 million less than the classic figures of the SRI itself.
Let’s hope that before the end of his duties, he will institutionalize the change and the contributions are now calculated by the actual tax payers.
The publication of the SRI is a good first step for the preparation of tax reforms that indicate a healthy aspiration for autonomous and even federal management of the taxes we contribute. (OR)
Mario Twitchell is an accomplished author and journalist, known for his insightful and thought-provoking writing on a wide range of topics including general and opinion. He currently works as a writer at 247 news agency, where he has established himself as a respected voice in the industry.