Elimination of the ‘green tax’ appears likely

Jun 20, 2019 | 19 comments

Ecuador’s so-called green tax appears headed for the dust bin.

Ecuador’s National Assembly.

In Tuesday’s debate at the National Assembly, there was overwhelming sentiment to eliminate the tax originally designed to protect the environment. “The intention was good but the unintended consequences were not,” said assemblyman Homero Castenier. “It did not meet its objective and now it’s time to acknowledge the mistake and eliminate it.”

A project of former president Rafael Correa, the green tax applied to “luxury cars” which were defined as those costing more than $30,000, cars older than 10 years and those with larger engines.

“Ultimately, this was a confiscatory tax and a money grab by the old government,” said Castenier. “It also unfairly targeted poor people who could not afford to buy newer cars.” He provided an example during debate of a 12-year-old car valued at $3,000 that was taxed at $1,200 annually.

The legislation to eliminate the tax goes to second debate next week.

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