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FEATURED Q&A   

JUNE 24, 2015

Ecuador: Will Correa Resurrect His Tax Plan?


Ecuadorean President Rafael Correa recently announced that he was temporarily halting a plan to boost inheritance and capital-gains taxes. The announcement followed large street protests in opposition to the tax hikes. Will the plans eventually go forward, or will they be permanently shelved? What would be the economic effects of such tax increases? Is Correa facing mounting levels of political and public opposition to his agenda?

Abelardo Pachano, president of Finanview in Ecuador, former CEO of Produbanco and former Ecuadorean central bank president: "Some government officials have cited a recently published book by economist Thomas Piketty as support for actions that governments must take to avoid the huge inequality that prevails in economies today. Piketty’s book advances the notion of putting a global tax on capital, and the inheritance tax is a way to put a tax on the stock of capital of individuals. But it does not make sense for small, developing country with a free-market economy like Ecuador to be the pioneer on this idea. It would produce a big outflow of capital, and it violates property rights and the rule of law. Moreover, proposing these taxes was done at a very bad time, considering Ecuador’s economy has suffered a big external shock due to the fall of oil prices. The tax proposal would increase de-monetization at a time when the financial system is suffering from ..." MORE


ABOUT THE LATIN AMERICA ADVISOR

The Dialogue publishes the Latin America Advisor every business day for a distinguished membership of informed corporate leaders, scholars and government officials invested in Latin America's development and future.

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SECTORAL PUBLICATIONS


The Advisor also publishes sector-specific titles in energy and financial services trends affecting the region.

 

 


Diego Arria
Director,
Columbus Group

Genaro Arriagada
Nonresident Senior Fellow,
Inter-American
Dialogue

Joyce Chang
Global Head of
Emerging Markets Research, JP Morgan Chase

W. Bowman Cutter
Former Partner,
E.M. Warburg Pincus

Dirk Donath
Senior Partner,
Catterton Aimara

Marlene Fernández
Corporate Vice
President for
Gov't Relations,
Arcos Dorados

Peter Hakim
President Emeritus,
Inter-American
Dialogue

Donna Hrinak
President,
Boeing Latin America

Jon Huenemann
Vice President,
US & Int'l Affairs,
Philip Morris

James R. Jones
Co-Chair,
Manatt Jones
Global Strategies

Craig A. Kelly
Director, Americas
Int'l Gov't Relations,
Exxon Mobil

John Maisto
Director,
US Education Finance Group

Nicolás Mariscal
Chairman,
Grupo Marhnos

Thomas F. McLarty III
President,
McLarty Associates

Carlos Paz-Soldan
Partner,
DTB Associates

Beatrice Rangel
Director,
AMLA Consulting

José Antonio Ríos
Chief Executive Officer, Vadium Technology, Inc.

Gustavo Roosen
Chairman of
the Board,
Envases Venezolanos

Andrés Rozental
President,
Rozental & Asociados 

Shelly Shetty
Head, Latin America Sovereign Ratings
Fitch, Inc.

Roberto Sifon-Arevalo
Managing Director,
Americas Sovereign & Public Finance Ratings, Standard & Poor's

 

 

Erik Brand
Publisher and Director,
Corporate Program
TEL: 952.892.0177952.892.0177
EMAIL: ebrand@thedialogue.org

Gene Kuleta
Editor
TEL: 202.463.2920202.463.2920
EMAIL: gkuleta@thedialogue.org

Megan Cook
Reporter and Assistant Editor
TEL: 202.463.2562202.463.2562
EMAIL: mcook@thedialogue.org