The rate of the capital outflow tax will remain at 3.50%

On December 29, 2023, President Noboa decreed that the rate of the capital outflow tax won't be lowered until at least December 31, 2024. This means that the tax rate will remain at 3.50%. The president has stated that declining tax collections make it impossible to further lower this tax rate.

The capital outflow tax (impuesto a la salida de divisas - ISD) applies to remittances abroad in cash or by check, transfers, and withdrawals of any kind. You must pay this tax, for example, when you send money from Ecuador to a foreign country. The rate of the capital outflow tax used to be 5%. In 2022, the tax rate was gradually lowered from 5% to 4%. In 2023, the tax was gradually lowered to 3.50% on July 1. Ex-President Lasso planned to reduce the rate to 2% on December 31, 2023, to attract more foreign investments. He originally wanted to abolish this tax, but the Ecuadorian parliament didn't support this plan.