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Today I'm going to talk about why removing the EcoDelta tax is a good idea to lower ticket costs and potentially, attract new airlines to Ecuador, and might even help construction of the Daular Airport is completed before.
As we have already deeply analyzed, the cost of tickets in Ecuador, both domestic and international, they are expensive in general, where among many of all factors, taxes are an important burden that raises the same.
It's good to explain again, briefly, that for a new airline to fly to Ecuador or the current ones to increase their flights, Ecuadorians also have to travel abroad, leave the country for whatever reasons.
The flights have to be filled, so to speak, in both ways. It is not useful for an airline that the flight from Europe comes completely full, if you return from Ecuador with 10 passengers, we Ecuadorians, we also have to fill the planes.
For this reason, is that dismantling the Eco Delta tax is a good idea.
ED tax – EcoDelta
For those who don't know, any ticket or air ticket that its issuance that has been generated in Ecuador, will have a surcharge of $50 Dollars on its total value and will be charged directly on the ticket.
This tax has been around for many years., but its most recent increase occurred on 16 March of 2016, when i pass from $30 a $50 Dollars, all with the aim of generating resources for the tourism promotion of Ecuador as indicated by the tourism authorities of the time. Until the 2015 were $5 and quickly reached the $50.
Despite this goal, it is not known, nor is it public in which these collections are used and nor how they have been invested in the promotion of the country. What is sure, several hundreds of millions of dollars have been raised.
with a simple sum, yes from the 2016 they will have emitted 3 million tickets in Ecuador, this would imply that the government collected $150 millions.
The EcoDelta has been in force in Ecuador since June 2009.
EcoDelta value
RATE: “Eco Delta -ED-” en cincuenta dólares de los Estados Unidos de Norteamérica (US$ 50,00), and in sixty dollars of the United States of America (US$ 60,00) for each passenger trip on a charter flight from Ecuador abroad.
Art 39,- Tourism Law
Ministerial Agreement No. No. 20160007
Dismantling the EcoDelta tax is a good idea
What I propose in these lines has the sole purpose of recommending, that the EcoDelta be gradually dismantled, not to be abruptly removed, which would be great, but it's not the right way to do it.
Dismantle this tax little by little, For example, going back to the $30 and so on until potentially removing it, will bring with it only one result, more Ecuadorians traveling abroad.
Indirectly, They also sought to somewhat curb the outflow of foreign currency from the country by increasing the cost of tickets, but if the Government dreams of achieving the desired 1×1 in tourism, We need more airlines to fly to Ecuador or for the current ones to open new destinations and for us to fly to them too.
¿Se imaginan cuánto costaría un pasaje Quito – Bogota without the EcoDelta? ¿Un Quito – Fort Lauderdale? ¿Guayaquil – New York?
With promotional prices and with a purchase anticipation of at least 3 months, the tickets could be in value close to these:
- Quito – Bogota $140.
- Quito – Fort Lauderdale $330
- Quito – Lima $200
- Guayaquil – New York $480
- Guayaquil – Madrid $690
- Guayaquil – Amsterdam $750
No doubt there will be cheaper prices with offers, just remember the last promotion you saw at your dream destination and subtract $50, un precio muy bueno ¿verdad?
As I said, the idea is not to remove it, but lower it gradually, so the authorities can measure and realize, that they will not collect less but the opposite, since more people will fly more, making the most massive collection, but with a lower tax.
Let's just think that a family of 5 people want to spend their vacations in Colombia, they have to add to their budget $250 Dollars, what could be invested in one more day of vacation or a tourist trip within Ecuador as examples.
Taxes like this are not new or rare, other countries have them too and that's ok, but in our case it is high and is offset by the airport and government plan to attract more airlines to attract more tourists with the goal of the same number of inhabitants and tourists 1×1.
Let's not forget, without Ecuadorians flying abroad, we will not see the increase in tourists, since there will be no new destinations and airlines, at least not as large an increase as is sought.
PT tax – Tourist Power
further, There is another tax which is charged exclusively for tickets that are issued abroad and have a final destination in Ecuador., this tax is called Tourist Power and is charged directly on the ticket.
Like the EcoDelta, has the objective of promoting the tourism promotion of Ecuador to the world.
This is another tax that although, it is not considerable as it is $10 Dollars, Everything adds up to the traveler's budget and they could be invested enjoying a delicious ceviche on one of our sunny beaches..
RATE: Contribución denominada «Potencia Turística – PT-» de Diez 00/100 United States of America dollars (US$ 10,00)
Art 39,- Tourism Law
Ministerial Agreement No. No. 20150004
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as you state, Nicholas, the total or partial elimination of these taxes is crucial. Ecuador has everything to be a great world destination and the air culture in our country must increase so that foreigners come to know the wonders that the Middle of the World offers. A) Yes, even the domestic market would grow more than it is already doing.
I totally agree Jordy. Thanks for comment.
however the fear , is that it can happen to us like Argentina where they need $13 a billion dollars a year for external tourism...since Argentines like to travel this amount is unbalancing their economy...and it is not something ideological, just investigate and you will see that the same economists there are thinking of taxing credit cards credit and tickets so that many Argentines do not go abroad
There has to be a balance. In any case, on domestic issues, Argentina has grown like never before in its history this year, which implies that local tourism is also growing.
Argentina greatly devalued its currency in the last two months of 20 a 28 so it is more difficult for them to travel abroad but in return it will eliminate from the 15 August the minimum fares so the tickets will drop a 40 % less and that they already dropped thanks to the arrival of flybondi before a ticket to cordoba and bariloche round trip cost you no less than 100 and 160 now you get for 50 and 90.
with deregulation it is believed that they will cost 30 and 50 obviously in advance
and to that the arrival of jetsmart and norwegian is expected to operate domestic and international for November.
In Ecuador, these high taxes should be lowered, especially the ecodelta and that of internal flights, which in Quito is almost 18 dollars which for such a small country is not justified
It is a good proposal Nicolás and hopefully this can happen in the short or medium term. Foreign, tourists prefer to visit neighboring countries like Colombia, Peru that are more competitive and those countries have better infrastructures.
It is crucial to lower the costs of tickets issued in Ecuador so that there is more tourism.
They don't necessarily have better infrastructure, but they are cheaper in general, even for the coin.
Well said, Nicolás, we must push this initiative and let it reach the ears of the Ministry of Tourism, In fact, when I travel my tickets originate from outside the country because they are cheaper for me.
Hello Mario, Hopefully this post is of some use., the idea is to support Ecuador. Your idea is interesting., buy tickets to fly from Ecuador as if you were abroad.