Ecuador maintains VAT at 15% for 2025

Ecuador's President Daniel Noboa has signed an executive decree maintaining the Value Added Tax (VAT) rate at 15% for 2025. This decision continues the increase from the previous standard rate of 12%, initially implemented eight months ago under a law aimed at addressing internal armed conflict and insecurity.

President Noboa, through Executive Decree 470, justified the measure as a necessary step to ensure fiscal sustainability and support public finances amid challenging economic conditions. The Ministry of Finance provided a favorable recommendation for the extension, citing public finance and balance-of-payment needs.

The VAT increase, introduced earlier in 2024, was part of an urgent economic law designed to address the country's internal security issues. According to the decree, maintaining the higher VAT rate is critical for securing government revenues to sustain public finances and manage the ongoing conflict.

Source: Primicias.