The President of Ecuador will seek to raise taxes to finance his security plan

The President of Ecuador will seek to raise taxes to finance his security plan

The Ecuadorian president, Daniel Noboa, asked lawmakers to consider raising the value-added tax to fund their efforts to combat criminal gangs, as the armed forces intensified their operations in violent areas on Friday.

A dramatic increase in violence this week – including the on-air assault of a television station, the hostage-taking of 178 prison staff by inmates and the kidnapping of police officers – appears to be a response by criminal gangs to Noboa’s plans to address the security situation.

Noboa, who took office in November, declared a state of emergency and named 22 gangs as terrorist organizations and military targets.

Three hostages have been freed, the Snai prison agency said late Thursday, with the help of the Catholic Church and the Red Cross. Another 21 detainees in the Cuenca prison were treated by the Red Cross, he added.

The government has said that operations are underway to release hostages held in at least seven prisons, but there has been little information about their statuswhich has generated criticism from their families and colleagues.

Security has worsened the serious economic problems, while the country deals with internal liquidity problems and limited external financing options.

Noboa’s tax proposal, sent to the National Assembly late on Thursday, would increase the value added tax (VAT) by three points from 12% to 15%. The bill is considered urgent and must be approved within 30 days.

The legislators – in a rare show of unity – have already approved two urgent proposals from the Noboa government, another tax bill aimed at increasing youth employment and a law designed to attract investment in the electricity sector.

“The current security crisis in Ecuador underscores the urgency of increasing possible tax collection for the State,” Noboa said in a document shared by the Assembly. “The increase in VAT will give the State a constant source of income.”

The measure could raise about $1.3 billion a year and could go into effect in March if approved by lawmakers.

The funds would be used to finance weapons and equipment for security forces and improvements to the prison well as payments owed to regional governments, according to the document.

Ecuador closed 2023 with a fiscal deficit of more than US$5.7 billion, according to the government.

The Armed Forces said on social networks that it has intensified operations in several provincesarresting gang members and confiscating weapons.

Meanwhile, the attorney general’s office reported that three people were detained accused of planning an attack against the commander of the national police, without providing further details. The police did not comment on the matter..

The Noboa government blames the deteriorating security situation on the increase in drug trafficking through Ecuadorwhich borders Colombia and Peru, cocaine-producing countries, and has become an important drug shipping point.

On Thursday, Noboa presented details of two new high-security prisons that he promised to build to hold the main leaders of criminal gangs.

Ecuador will ask people entering the country through its borders with Peru and Colombia to show their criminal records for the duration of the state of emergencythe government said late Thursday.