Author: Eduardo Cadena Dongilio

Source: Hoy Online - - DINERO - 22/07/2009

Analysis

The tax base is currently facing many financing problems and is reflected in the rapid reduction of its deposits in the banking system. In the last quarter of the year 2008 and the first of 2009 the Gobierno spent $ 7 637 million and all of it for $ 5 116 million.

This would explain measures such as the intent of an early sale of oil for $ 1 000 million and an additional $ 200 million package through a new tax package that transfers more resources from the private sector to state expenditure.

The tax reform would aspire to increase the tax base for declaring the income tax, adding the declaration of dividends to natural persons, in case the reform is approved, which would mean that all types of income will be recorded.

In the same way, if you plan to double the Tax on Capital Income and 1% to 2%, which evidently instead of maintaining resources in Ecuador, you will have the opposite effect in the short term; Anything that would encourage the outflow of human resources if it doesn’t fit Ley and luego will be constituted in front of the inflow of capitals and any investor who wants to put his resources in Ecuador would have to consider this as an additional cost.

The project contains other reforms that seek to increase recalls; among the most important things we have: recording with Impuesto a los Consumos Especiales (ICE) for various goods and services such as alcoholic beverages, cigarettes, "wine" vehicles, which, of course, will increase even more smuggling incentives, the informal market and it will reduce formal private sector resources.

The new tax proposal is contractual for the economy and is part of a policy that no country within the current economic crisis would apply to what is present contrary to any economic logic.

Eduardo Cadena Dongilio, Center for Studies and Analysis CCQ