In April 2024, through the Organic Law of Economic Urgency, Ecuador raised IVA, its value added tax, from 12% to 15%. The change took effect immediately and remains in place in 2026. For a commercial importer, an order that paid USD 600 in VAT last year now pays USD 750. Across 12 imports a year, that is USD 1,800 more coming straight out of your margin unless you adjust your selling price.
How VAT is calculated on an import
Import VAT is not calculated directly on the FOB or the CIF value. It is calculated on the taxable base, which is CIF plus ad valorem duty plus FODINFA (the 0.5% child development contribution) plus ICE (the special consumption tax) when it applies. This matters because any increase in duty or ICE also pulls a higher VAT along with it, in a cascade.
Before and after the increase
Take a FOB import of USD 5,000 from China, with 10% ad valorem duty, USD 100 of ocean freight and no ICE.
| Item | With 12% VAT | With 15% VAT |
|---|---|---|
| CIF | 5,175 | 5,175 |
| Ad valorem 10% | 517 | 517 |
| FODINFA 0.5% | 26 | 26 |
| VAT base | 5,718 | 5,718 |
| VAT | 686 | 858 |
| Total taxes | 1,229 | 1,401 |
| Difference | 0 | +172 |
On this order the VAT increase adds USD 172. Across 100 units, that is USD 1.72 per unit. If your gross margin was 20%, you lost almost 2 points from the tax change alone.
How to offset the increase without killing volume
- Renegotiate FOB with your supplier: a 3% to 5% discount absorbs the full increase.
- Switch from air to ocean freight when your timeline allows. You save more than the VAT increase costs.
- Consolidate loads with other importers through Daleki Trade to lower freight per kilo.
- Recover the VAT you paid as a tax credit if you have a RUC (taxpayer registration number) and issue invoices with VAT.
- Raise selling prices selectively on SKUs with low price elasticity before you apply an across the board increase.
Who can recover the VAT
Companies and individuals with a RUC who import for resale can offset the VAT paid on imports against the VAT charged on their sales. This is done through the monthly return filed with the SRI, Ecuador's tax authority, with the import invoice as support. Imports for personal use or final consumption do not create a right to a tax credit, and the VAT paid is a final cost.
ATLAS already uses 15% VAT in every estimate. If you received an old quote from another provider that still applies 12%, ask them to recalculate it before you commit.
