The increase of two percentage points to the current VAT (12%), a measure that will take effect on Wednesday and will last for one year, was approved in the Solidarity Act. This legislation seeks to raise funds for the economic recovery of southern Esmeraldas and Manabi. These provinces were hit by the earthquake of last April 16.
Based on this provision, companies and businesses nationwide have to update their systems and the prices of products to include the new VAT.
Carlos Sarche; business manager of the company Olimpyc Juice Olyjuic, which produces the drinks of the Orangine brand, explained that suppliers of bottles and caps were already notified of the new price which includes the 14% VAT from June 1st.
But the company has reserves, so it has 15 days to adjust to the new values. The deliveries of Orangine to be made this week to retail outlets will be made with the previous price. This means that these days the firm will assume the 2% of operating costs to standardize the price with the new tax.