Colombian government lowers revenue target for proposed tax reform


Colombian President Ivan Duque speaks during an interview with Reuters in Bogota, Colombia, March 12, 2021. REUTERS / Luisa Gonzalez / File Photo

BOGOTA, April 28 (Reuters) – The Colombian government has cut the amount of money it hopes to get from a tax reform bill in an attempt to gain enough support to push the legislation through Congress, said Wednesday the Deputy Minister of Finance Juan Alberto Londono.

The government is now seeking to raise between 18,000 and 20,000 billion pesos ($ 4.84 billion to $ 5.38 billion), Londono said. He added that he was open to negotiating other parts of the proposal, which includes measures to reduce sales tax exemptions and change income taxes.

An original plan presented to lawmakers last week sought to raise an additional 23.4 trillion pesos ($ 6.29 billion) – the equivalent of 2 percent of Colombia’s gross domestic product (GDP) – by eliminating many deductions and by increasing taxes on individuals and businesses.

“We are looking for a consensus, we are looking for ways for everyone to do a little more to bridge the gap, to have the peace of mind that our country can pay its debt and that our vulnerable population is not going to suffer because we cannot pay for social programs, ”Londono said on local radio station Caracol.

“Maybe the amount will go down, which will reduce social programs in time and in size …

The proposed reform has met stiff resistance in Congress, especially from a coalition of parties supporting President Ivan Duque’s government. Opponents argue the changes would put unnecessary strain on taxpayers already strained by the economic crisis caused by the coronavirus pandemic.

The largest Colombian unions are planning to hold a strike on Wednesday to protest the measures as well as other government policies.

“A revision of the sales tax for utilities is possible, we could look at the sales tax chain in the family grocery store so that the prices for the end consumer are not affected, as well as a tax on the progressive income, ”he added.

“Everything is open to discussion,” he said.

($ 1 = 3,717.46 pesos)

Reporting by Nelson Bocanegra Writing by Oliver Griffin Editing by Paul Simao

Our Standards: Thomson Reuters Trust Principles.


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