The Ecuadorian government announced that the Foreign Currency Outflow Tax will be reduced to 3.5% in an operation that is expected to reach 2% in December.
“The index of the Foreign Currency Outflow Tax, which at the beginning of the year amounted to 4%, fell from 3.75 to 3.5%,” The Ministry of economy of Ecuador said.
The measure seeks to boost the economy and is part of the Guillermo Lasso government’s plan to cut some taxes with the aim of reactivating the level of consumption among citizens.
Economy Minister Pablo Arosemena said that this type of measure seeks to put “more money in the pocket of Ecuadorians”.
“The rates of many taxes have already been reduced, such as income tax, which in the opinion of the executive branch has affected the middle class,”Arosemena said.
Arosemena insisted that when the Lasso government began its administration, in May 2021, the indexation of the tax on the Foreign Currency Outflow Tax was 5%, which in 2022 was reduced to 4 percent and that this year it is expected to end at 2%.
The announcement of the Ministry of economy came at a time when the country is heading for an extraordinary electoral process because President lasso invoked the so-called”Cross-death” last May, a constitutional mechanism by which he dissolved parliament, halved its mandate and called early elections.
