Ecuador Approves Tax Amnesty Aimed At Coaxing Delinquent Taxpayers To Settle Bills, Introducing New Incentives

Ecuador's National Assembly on Tuesday approved a tax amnesty that will focus on coaxing delinquent taxpayers to settle their outstanding bills and introducing new incentives to boost jobs for young people in the country.

The tax reform is expected to generate over $830 million, which could help revitalize the economy of Ecuador.

One hundred seven legislators out of the 135 present at the session approved the tax amnesty, which was proposed by President Daniel Noboa. However, some minor adjustments were made to it, and the 36-year-old president can accept or reject these changes.

"We will once again have order and the resources to combat lawlessness," the president said after the voting session on the same day, according to Reuters.

As for the tax incentives, they will be provided in the form of tax income discounts for companies that will hire individuals between the ages of 18 and 29 for at least a year.

In a post on X, Noboa called the approval of the tax amnesty a "victory" for the country.

"This is a victory for Ecuador," he wrote, as per Google's translation of the original post from Spanish. "I want to thank the National Assembly because we finally managed to agree as a country. Finally hope could prevail. This is just one more step of the many that we must continue to take together to face the serious challenges that we are experiencing today in Ecuador."

Last week, the president said the country will cut down $1 billion in spending before looking into taking out loans from multilateral organizations. He said Ecuador will also sell gold reserves to raise around $300 million.

"It's not to lower reserves, but instead for the profit it will generate for the central bank," Noboa said, according to a separate report by Reuters. "A small percentage could generate additional profits of $300 million, which will serve to attend to the level of urgency we have with local governments."

Noboa added that he spoke with the International Monetary Fund (IMF) in the past, and among the things they agreed on was the inefficiency of public spending and reducing it by at least $1 billion in 2024.

"We are at a level of inefficiency," the president said further.

Noboa is one of the youngest presidents in the history of Ecuador. He took office last month.