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The Constitutional President of the Republic, Daniel Noboa Azin, issued Executive Decree 368, which establishes a temporary tax incentive for the tourism sector during the Labor Day holiday.
Tax Rate Reduction
The general Value Added Tax (VAT) rate is temporarily reduced to eight percent (8%), applicable to services defined as tourism activities, during Thursday, April 30; Friday, May 1; Saturday, May 2; and Sunday, May 3, 2026.
Establishments
Establishments providing services classified as tourism activities, in accordance with Article 5 of the Tourism Law, must update their billing systems and issue the corresponding invoices applying the 8% rate.
Timely updates to billing systems will be key to issuing valid invoices under the temporary rate and ensuring tax compliance.
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This publication contains information of general interest and does not constitute legal opinion on specific issues. Any analysis will require legal advice from the Firm.