Ecuador’s Ministry of Telecommunications announced Friday that it plans to eliminate tariffs on cell phones and computers. Currently, cell phones carry a 15 percent import tariff while computers have an entry tax of 10 percent.
The ministry also said it would push to add 1,000 free Wifi hotspots in the country, reduce internet charges, increase coverage and to make more government functions digital.
Ecuador Secretary of Communication Andrés Michelena said that cell phones and computers can no longer be considered “luxury items” and that poorer citizens are affected most directly by the tariffs. “This technology is part of mainstream life today and these devices are not items purchased exclusively by upper income people,” he said. “For most people, smart phones are essential for work and for communicating with the family.”
Jorge Cevallos, executive director of the Ecuador Association of Telecommunications Companies, welcomed plans to eliminate tariffs but said an earlier attempt had failed. “We look forward to the government following through on the plan this time. This is something that is long overdue,” he said.
According to Cevallos, the elimination of tariffs will end the smuggling of phones and computers from Peru and Colombia, where there are no import fees. He said the government should also eliminate other taxes on what it considers luxury goods, which are taxed at 15 percent.
Michelena said the telecommunications has established a goal of connecting 80 percent of Ecuador homes to the internet. “We already have a high rate of cell phone ownership but need to increase smart phone use, which is 37 percent,” he said. “It is also our objective to increase the penetration of internet services generally and to add more public Wifi zones.”