Treaty Shopping in Double Taxation Agreements: A Review of the Tax Impact (Ecuador)

Treaty Shopping en Acuerdos de Doble Imposición: Revisión del Impacto Tributario (Ecuador)

Abstract

Treaty Shopping in Double Taxation Agreements (DTAs) constitutes an abusive tax practice that erodes the tax base and undermines the fiscal equity of recipient states, with particular impact on developing economies such as Ecuador. This study analyzed its effects on tax revenue collection and fiscal equity in Ecuador, identifying existing regulatory gaps and reform alternatives to strengthen the national tax system. A qualitative approach was adopted, with a descriptive scope and documentary design, grounded in a systematic review following the PRISMA 2020 criteria. The sample comprised 25 empirical and normative studies selected from specialized databases for the period 2019–2023. The results revealed that Ecuador accounted for 36% of the analyzed studies; the corpus identified regulatory gaps in DTAs that facilitate tax treaty abuse and aggressive tax planning. The measures adopted (including the definition of beneficial ownership, anti-abuse clauses, and information exchange protocols) represent only partial progress. It is concluded that treaty shopping significantly affects tax revenue collection and fiscal equity in Ecuador, and that the partial implementation of BEPS standards demands comprehensive legislative reforms and enhanced international cooperation.