Article 188.8.131.52.47 of Decree 286 of 2020 initially established that orange economy companies were the legal entities that pay income tax under the ordinary regime domiciled in Colombian territory, whose object was focused on the development of technological value-added industries and creative activities and furthermore, enterprises had to be incorporated and start their economic activity by December thirty-first (31), 2021.
However, Article 44 of Law 2155 of September 14, 2021 amended this term and provided that for companies in the orange economy to apply for the tax-exempt income tax incentive, they must have been incorporated. and start their economic activity before June 30, 2022, in addition to complying with other requirements.
However, in order to classify orange economic activities more accurately, it has been determined that they will be governed by the International Standard Industrial Classification of All Economic Activities (ISIC). The orange ISICs are divided into three main groups: (i) Arts and Heritage; (ii) Cultural industries; and, (iii) creative industries, new media and content software. Each of these groups contains full inclusion and partial inclusion activities.
Once it is verified in the ISIC that the company actually carries out an activity of the orange economy, it must be verified that the company also meets the following conditions: (i) having its main domicile in Colombian territory; (ii) be legally incorporated; (iii) have an annual gross taxable income of less than (80,000) UVT, which is equivalent to COP 3,040,320,072 for 2022; (iv) be registered in the Single Tax Register as a taxpayer under the ordinary income tax system; (v) have an investment amount of 4,400 UVT – equivalent to 167,217,600 COP, by 2022 – over a maximum period of 3 fiscal years; and (vi) respect minimum numbers of jobs of between 3 and 8 employees depending on the company’s gross tax revenue.
Finally, once all the requirements have been verified, a request for qualification of the investment project must be submitted online to the Orange Economy Commission of the Ministry of Culture. Subsequently, the compliance of the project is verified and the Minister of Culture issues the administrative act of compliance or non-compliance, with the prior design of the Orange Economy Commission of the Ministry of Culture, within thirty (30) working days following the date on which the project is presented.