On Tuesday, Ecuador’s National Assembly approved a new tax reform proposed by President Daniel Noboa.
Its goal is to boost the state’s budget by $832 million in 2024. This measure addresses Ecuador’s current economic challenges.
The reform introduces free trade zones. It also offers tax incentives. These incentives aim to create jobs, especially for young people.
They also seek to attract more investments to Ecuador.
Named the “Organic Law of Economic Efficiency and Job Creation,” the reform faced thorough discussions.
It received wide support in the Assembly, with 107 out of 132 members voting in favor. This decision came after a session lasting over four hours.
President Noboa submitted this proposal on November 27. He marked it as urgent for economic reasons.
The Assembly had 30 days to act on it. This law is Noboa’s first major action in the legislature since becoming President on November 23.
The Assembly made some changes to the original proposal. These changes relate to Income Tax and forgiving certain financial penalties.
These modifications came after 40 legislators debated and shared their views. Following the approval, President Noboa expressed optimism.
He believes the law will benefit young people and boost employment. He also expects it to bring financial stability and help address security concerns in Ecuador.
Noboa has previously spoken about the difficult financial situation he inherited. He referred to it as the worst in Ecuador’s history.
The fiscal deficit is expected to exceed $5 billion, about 5% of the GDP, by the end of 2023. This reform is a step towards addressing these economic issues.