IVA Drops to 8% on Hotels, Restaurants, and Transport Through Sunday — Here's What Qualifies

If you're eating out, booking a hotel, or renting a car anywhere in Ecuador this weekend, you're paying nearly half the normal sales tax.

President Daniel Noboa signed Executive Decree 368 reducing the IVA (Impuesto al Valor Agregado) — Ecuador's value-added tax — from 15% to 8% on tourism-related services. The reduction runs from Thursday, April 30 through Sunday, May 3, 2026.

What Qualifies

The reduced rate applies to services defined under Article 5 of Ecuador's Tourism Law (Ley de Turismo):

| Category | Examples | |----------|----------| | Accommodations | Hotels, hostels, registered lodging | | Food & beverage | Restaurants, cafés, bars | | Transportation | Flights, buses, car rentals, boat rides | | Travel agencies | Those providing their own transport services | | Tour operators | Event organizers, tourism intermediaries | | Entertainment | Amusement parks, casinos, gaming venues |

What Doesn't Qualify

Grocery stores, retail shops, utilities, and non-tourism services remain at the standard 15% IVA. This is specifically a tourism stimulus measure.

How It Was Set Up

The four-day weekend itself was created by a separate decree — Executive Decree 354 — which suspended work on April 30 to extend the Labor Day holiday. The IVA reduction was designed to encourage domestic tourism spending during the extended break.

What This Means for Expats

Check your receipts. The IVA line should read 8%, not 15%. Establishments are required by decree to apply the reduced rate — if yours doesn't, point it out.

The savings are meaningful at scale. On a $100 hotel night, you save $7. On a $50 dinner for two, about $3.50. If you're traveling for the full four days, the cumulative discount across meals, lodging, and transport adds up.

This applies nationwide. Whether you're in Cuenca, on the coast, in Quito, or anywhere else in Ecuador, the reduced rate follows you. If you've been planning a weekend trip, the timing works in your favor.

Source: El Universo