On March 11, Minister of Economy, Richard Martinez, announced that the Executive branch is working on a tax reform bill, to be introduced in the last quarter of 2019 to the National Assembly. This will modernize the tax system to meet the requirements set by the International Monetary Fund following Ecuador’s signing of a debt agreement with the IMF and several credit agencies for $10.2 billion dollars. Until its presentation, the Executive will promote dialogue with stakeholders to strengthen the reform.
The announcement is a consequence of the debt agreement signed by Ecuador and seven multilateral credit agencies for 10.2 billion dollars at the end of February. Among those bodies, the IMF’s contribution of 4.2 billion dollars in exchange for a series of conditions regarding economic policies stands out. One of those conditions concerns the restructuring of Ecuador’s tax system.
Martínez stated that they want to modify the current system which is, in his words, “structured for the economic model of the past decade”. To this end, they will promote a new system that “accompanies the new dynamics of the country”. The objective will be to create a system that is “simpler, more equitable, promotes growth and does not affect the most vulnerable groups”.