Confusion about package tax; Ecuador makes Bank of the South deposit

Jul 24, 2014

After announcing that it would begin charging a $42 tax on small packages shipped from overseas, the government is sending mixed messages about exemptions of the tax.

The tax would affect shipments of less than four kilos, part of the country’s 4×4 package plan (four kilos with a value of less than $400) for Ecuadorian consumers.

The government ordered the new tax two weeks, apparently due to pressure from Ecuadorian aparell manufacturers and store owners who claim that overseas shipments of clothing were affecting their bottom line. The manufacturers say that 70% of overseas shipments are clothing.

Since the first announcement of the tax, several exemptions have been suggested but, as of early Wednesday, there was little clarity about which would apply in the final analysis. The only exemption that appears certain is for books and medicine.

One Ministry of Industry official said on Monday that packages received through the national postal system, Correos del Ecuador, would be exempt from the tax. On Tuesday, another official said that the exemption would not apply packages delivered to the postal system’s international package delivery service, Club Correos.

There is more confusion about special exemptions that would be granted to Ecuadorians who have returned from living overseas.

In a Wednesday night television interview, Ecuador’s Minister of Industry, Ramiro Gonzalez, said the confusion would be cleared up by early next week.

 

Ecuador makes first Bank of the South deposit

Ecuador has made the first deposit, for $8 million, at the new South American Bank of the South.

Ecuadorian Foreign Minister Ricardo Patino said on Wednesday that he expects the Bank to become an indispensable tool for development in the region. “I see it as a transformative institution that will provide financial independence to Latin American countries,” he said.

Patino and other South American leaders see the Bank of the South as an alternative to traditional global lenders such as the World Bank and the International Monetary Fund (IMF).

Founding countries of the bank includes Argentina, Brazil, Bolivia, Ecuador, Paraguay, Uruguay and Venezuela. The bank will be headquartered in Caracas and have offices in Bolivia and Argentina. Other countries that have thrown their support behind the new bank since its founding include Peru, Colombia, Chile, Guyana and Suriname.

The finance chiefs of member countries meet Friday in Argentina to elect the bank’s president and board of directors, said Patino.

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