The measure will apply to all consumption in the tourism sector. The objective is to reactivate the economy of the sector, one of the hardest hit by the pandemic.
This January 25, 2022, during the radio program “Encontrémonos”, President Guillermo Lasso announced that he will apply a reduction from 12% to 8% VAT during the next carnival holiday.
That reduction will apply to all consumption in the tourism industry, considering that this needs a greater reactivation after it grew back in 2021.
The President recalled that within the tax reform, approved at the end of November of last year, the presidential authority was established to lower the VAT for at least four holidays every year.
In that sense, the Carnival It will be the first experience to measure the impact of this type of measure.
“We will have a four-day holiday and to stimulate the local tourism, we will lower the VAT up to 8% during those four days, in order to boost the sector”, stressed Lasso
Do not pay more Chinese debt with oil
Another important economic announcement was that, during the presidential trip to China, Ecuador will be sought to stop paying its debt with that Asian country through the delivery of barrels of Petroleum.
“We are going to look for the best terms and, above all, we are going to untie the Petroleum from the payment of the debt to the China, so that the Petroleum be freely available to the Ecuadorian Government. That is the great challenge of this negotiation”, said Lasso
The president pointed out that if it is possible to adequately reschedule the pending payments with China, a great relief will be given to public finances.
“The debt from Ecuador with China it is close to $4.6 billion; close to $500 million is concessional debt with a very low rate and long term; the renegotiable does not go from $4.100 to $4.200 million and the average rate is between 5.5% and 6%, it is a rate in accordance with the interest rate of the renegotiation of the bonds that took place in 2020, “explained Lasso.
Along with the renegotiation of the debt With that Asian country, the Ecuadorian government hopes that in the next few days the review of the program with the International Monetary Fund (IMF) will take place.
A disbursement of $700 million depends on this review, which is pending since the end of 2021
In addition, in February 2022, a loan from the World Bank (WB) for an additional $700 million is also expected. (JS)
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