Lasso’s Opportunities law appears to be ‘dead on arrival’ in the National Assembly

President Guillermo Lasso’s proposal to reactivate the economy has little chance of passage in Ecuador’s National Assembly, according to both its supporters and opponents. “The legislation, as presented, will need major revisions to have any chance of becoming law,” says Nathalie Arias, a member of Lasso’s Creo party.

President Guillermo Lasso

Opposition to the Creation of Opportunities Law appears almost unanimous among centrist and center-left legislators, who dominate the Assembly, making it likely that Lasso will be forced to present the law to voters in a national referendum for it to have any chance of becoming law.

Based on early reaction, it appears unlikely that the Assembly’s Legislative Administration Council (CAL) will qualify the proposed law to be sent to the full legislature. “Our job is to be impartial politically in sending legislation to the Assembly but, on first reading, it is my opinion that Opportunities is constitutional,” says CAL member Javier Saquicela. “The constitution is clear that proposals that would repeal or reform existing law must deal with only one subject and this one includes changes to labor law and tax law and possibly others.”

The leadership of CAL has not given a date when the legislation will be considered.

Although most opposition to Opportunities comes from the center-leftist Assembly members, it is also drawing fire is from some conservatives who claim Lasso is breaking his commitment not to raise taxes. Former Guayaquil Mayor Jamie Nebot, leader of the Social Christian party, says his Assembly members will oppose the legislation because it “punishes the engines of economic progress” by taxing the wealthy. “These are the people who invest in the future of Ecuador so why would you punish them?” he asks.

Opportunities proposes new taxes on those earning more than $24,000 a year and includes a special two-year assessment on those who own property valued at $500,000 or greater.

Outside the Assembly, opposition is strongest from labor unions, who say the law is an attack on workers’ rights. “Provisions of this law would roll back labor rights by more than a century,” says José Villavicencia, President of the United Workers Front. “It would allow employers to hire workers without providing benefits, such as Social Security, and eliminates the right to overtime and holiday pay. Companies can use the services of workers for four years or longer and then say bye bye, with no future responsibility.”

President of the skilled labor Cedocut union, Mesías Tamatuez, agrees with Villavicencia, and says that even Lasso’s tax increases are poorly conceived. “We need a total revision of the tax code and the addition of taxes, some of them temporary is not the solution,” he says. “The president acts as if people making $2,000 a month are wealthy and this is nonsense. His tax would hurt the middle class which he promised to protect.”

Like members of the Assembly, Tamatuez believes the legislation is unconstitutional. “To make changes like this, you need at least two proposals, one for the new taxes and another to change labor law.” He adds: “It appears that our president has not read the constitution.”