President granted authority to reduce the VAT rate for the tourism sector

A law published in Ecuador on 29 November 2021 authorizes the president to issue an executive order that reduces the standard VAT rate from 12% to 8% for persons providing the following tourism services on a regular basis: 

• Lodging; 
• Food and beverage services; 
• Transportation dedicated to tourism activities, including air, maritime and ground transportation, as well as the rental of vehicles for tourism purposes;
• Where travel agencies provide their own transportation; 
• Intermediation, tourist service agencies and organizers of congress and convention events; and, 
• Racetracks and amusement parks. 

The VAT rate reduction may be applicable for up to a maximum of 12 days per year, during holidays, weekends, and at the national or regional level. 

Nelson Morales  
nmorales@bdo.ec