Will Colombia Make Big Changes to Its Tax Overhaul?
Tax attorney Juan Camilo Riveira was recently quoted by the Inter-American Dialogue in its Latin America Advisor about the Colombian president's push for changes to a tax reform passed last year, which cuts taxes for businesses and raises them for the wealthy. Mr. Riveira discusses how this tax reform affects the Colombian economy and what the most significant changes could be.
“The tax reform approved in December 2022 continues to affect Colombia’s economy as it has introduced a higher level of taxation, not only for specific sectors like hydrocarbons and mining, but also for Colombian and foreign investors," he said.
Mr. Riveria continued by explaining which industries and sectors are being affected the most under the new reforms.
"Additionally, the extractive industries have been the most affected sectors of the economy with the latest tax reform," he commented. "However, hotels and the electric energy sector were also hurt by the increase of their tax rates or the inclusion of a surcharge for corporate income tax purposes."
He also speculated on how the government would react to recent court rulings and when to expect an updated reform.
"Considering the recent changes to the 2022 tax reform and the decisions of the Constitutional Court, the government will use all possible mechanisms to raise the initial budget," he said. "Therefore, a new tax reform will likely be presented to Colombia’s Congress in the near future."