The President of Ecuador, William Lassoannounced this Thursday, May 11, a draft tax reform that seeks to reduce the tax burden for middle-income families and popular businesses, in the midst of political instability in the country.
Said proposal was sent by the Ecuadorian government to the National Assembly of the same country as a matter of urgency to be voted on and approved within a period of 30 days.
However, comes at the same time that opposition lawmakers are advancing an impeachment process against Lassodue to accusations of alleged embezzlement in an oil transportation contract, which the president denies.
The tax proposal seeks to relieve some 340,000 taxpayers, but will imply a reduction of US$195 million in tax revenue for the country’s treasury.
“There are 195 million dollars that are going to stay in Ecuadorian homes to finance health, education or food expenses”, Lasso said in the presentation of the project. “It is in the hands of the assembly members to side with the citizens”, he added.
The reform bill proposes that taxpayers may deduct up to US$15,294 dollars of their personal expenses per year, depending on the number of family responsibilities, to lower the Income Tax. Pet expenses may also be included in the list of deductions, according to the reform project.
Lasso’s new proposal would tweak changes he proposed in late 2021, which increased tax liability for those earning more than $2,000 a month by reducing the amount of health, education and other costs they can deduct.
“The income tax table for natural persons will be more progressive and fair”, explained the Ministry of Economy of Ecuador in a statement.
The project also includes the creation of a tax for companies and players of sports forecasting platforms and another for the organizers of public shows.
Popular businesses will benefit from paying less taxes due to changes in the tax tables depending on their income and profits, the Government explained.
Source: Reuters
Source: Gestion
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