Ecuadorian President Daniel Noboa has enacted Executive Decree No. 542 on 24 February 2025, temporarily lowering the Value Added Tax (VAT) rate to 8% for tourism-related services during the Carnival holiday period from 1 March to 4 March 2025.
The VAT reduction applies to a range of tourism services, including accommodations, food and beverage offerings, transportation, travel agency operations, and event organization. Businesses providing these services are mandated to apply the reduced VAT rate and issue sales receipts that reflect this adjustment.
The Internal Revenue Service (SRI) is responsible for overseeing the enforcement of this decree, ensuring that businesses comply with the new VAT rate during the specified period.
This measure aligns with the government’s ongoing efforts to revitalize the tourism industry and support related economic activities during key holiday periods.
Earlier, Ecuador announced a temporary VAT reduction on tourism-related services, lowering the rate from 15% to 8% from 1 to 4 November 2024.
