The Decree-Law aims, on the one hand, to reduce environmental pollution and stimulate the process of using non-returnable post-consumer PET plastic bottles; and, on the other, to encourage inclusive recycling processes in an environment that promotes the circular economy.
The Decree-Law is applicable to companies and individuals who import, produce or market non-returnable PET plastic bottles used to package beverages within Ecuadorian territory, or who import beverages packaged in said bottles under the consumer regime, as well as to companies that bottle beverages in said bottles and recycling companies that are responsible for processing these wastes within the national territory.
Below, we describe the main characteristics of the Redeemable Tax on Non-Returnable Plastic Bottles (“IRBP”):
- Generating event: Bottling beverages in non-returnable PET plastic bottles used to contain alcoholic, non-alcoholic, carbonated, non-carbonated beverages and water. In the case of beverages imported under the consumption regime, the generating event will be their customs clearance.
- Active subject: The State.
- Taxable person: Bottlers of beverages contained in non-returnable PET plastic bottles and importers of beverages, under the consumption regime, contained in non-returnable PET plastic bottles.
- Taxable base: It is the number of units bottled or imported.
- Rate: For each non-returnable PET plastic bottle, the rate of two cents of a United States dollar (US$0.02) will be applied.
- Refund: The total value of the tax will be refunded only to recyclers and processors, in accordance with the certification issued jointly by the governing body of production and the governing body in environmental matters. The mechanisms and conditions for the refund process will be established in the Regulations of the Decree-Law.
- Exemptions: The bottling or importation under the consumption regime of dairy products and medicines in non-returnable PET plastic bottles is exempt from this tax.
- Declaration: The operations taxed with this tax will be declared within the month following their execution, in the form and terms established in the Regulations.
- Liquidation and payment: The number of bottled or imported units must be multiplied by the established rate. In imports, the liquidation will be carried out in the import declaration and the payment will be made prior to the dispatch of the bottles by the Customs Authority.
- Non-deductibility: The payment of the tax will not be considered a deductible expense for the liquidation of the income tax.
The respective Regulation will be issued within thirty days from the entry into force of the Decree-Law. In the meantime, the regulatory provisions and other secondary rules related to the IRBP refund process will continue to apply.
Author: Paulina Mora Ramón, Lawyer
This text is for informational purposes only and should in no way be considered as professional advice or recommendation. The comment or opinion is that of the author and does not represent an institutional position of the law firm. For more information, contact us at info@rodriguezlaw.ec
