2024-09-10 03:30:42
Finance Minister Ricardo Bonilla confirmed that the new tax reform will not affect the Value Added Tax (VAT) nor will it modify the threshold for taxpayers of personal income tax.
In an interview with El Tiempo, Minister Bonilla explained that the reform’s main objective is taxing the “super-rich,” those who earn more than 120 million pesos per monthclarifying that it will be a progressive measure. In this sense, natural persons with annual incomes of more than 1.5 billion pesos will be the main ones affected by the increase in the income tax rate, which will go from 39% to 41%. Bonilla explained that this measure will affect just over a thousand taxpayers throughout the country.
One of the current concerns is the price of diesel, which has been subsidized by the government. Although the agreement with transporters has reduced the increase in the price of this fuel, the estimated fiscal savings were significantly reduced. According to Bonilla, the original adjustment to the price of diesel would have generated savings of 1.5 billion pesos in 2024 and 4.2 billion in 2025. However, due to the agreement, the savings will now be only 360 billion in 2024 and 1.7 billion in 2025, which implies a decrease of 70% on average of the projected savings.
The minister also referred to the current deficit of the FEPC, which amounts to 11.6 billion pesos annually for diesel fuel alone. (diesel). Although the gasoline deficit has been adjusted, diesel will continue to be subsidized until 2025, in order to avoid an excessive impact on inflation and the economy of transporters. Although the price of diesel should have reached 13,200 pesos per gallon if it had been adjusted only for inflation since 2020, it is currently below that value.
You can read: New price of diesel for cargo and passenger transport
Financing Law
Minister Bonilla stressed that the Financing Law seeks to raise 12 billion pesos, mainly by reducing tax evasion and avoidance. Examples of this include taxing online gambling, which is currently not subject to VAT, and removing exemptions on the import of hybrid vehicles that do not meet energy transition criteria.
The bill also aims to encourage investment by gradually reducing corporate income tax. Small and medium-sized companies will see their nominal income tax rate reduced from 35% to 27% over the next five years, while sectors such as oil and coal will be excluded from these reductions.
You can read: Inflation in Colombia in August was 0.0%