Evaluation of the Impact of the Digital Services Tax on the Ecuadorian Economy

Abstract

The digital transformation has redefined human interaction and access to online services, driving the growth of the digital economy in Ecuador. However, this advancement poses significant challenges in terms of taxation. The absence of a clear fiscal framework for digital services could compromise fiscal equity and economic sustainability. This study evaluates the impact of the digital services tax on Ecuador's economy, analyzing its influence on businesses and consumers. Using a mixed methodological approach, which combines descriptive analysis of fiscal data and direct observation of transactions on virtual platforms, the study examines revenue trends and associated administrative challenges. The results indicate that while the tax has significantly increased fiscal revenue, it has also generated administrative complexities and complaints about incorrect charges. Additionally, there is a potential impact on final prices for consumers, which could affect the demand for digital services. It is essential to develop a regulatory framework adapted to the digital economy to maximize fiscal benefits without discouraging technological innovation or economic growth. This analysis provides insights  for effective fiscal policy formulation in the emerging digital context.