Ecuador Will Charge VAT on Digital Services

The Ecuador's Internal Revenue Service has declared its intention to charge VAT on digital service providers. It is reported that the tax rate will be 12%. The tax service has published a detailed list of the companies, which will be required to pay VAT. The list includes over 200 service providers.

The tax will be charged differently in different cases. For example, for the streaming audiovisual content, the service price will directly include tax. For the hotel booking service providers, the tax will be calculated based on the commission for using their website. The tax will also be calculated based on the commission for home food delivery services.

However, VAT requirements will not apply to some companies. In particular, the companies providing the hosting services or working in the cloud computing are not required to pay tax. VAT payers in Ecuador will be required to pay tax and report according to the rules that apply in other areas of taxation.

Law & Trust provides its services for the clients who work in Ecuador. Our experts will tell you in detail who is a VAT payer for digital services and will help to prepare all necessary reports for tax authorities.