Jose Antonio Ocampo the next Minister of Finance, gave statements regarding the tax reform plan that the government of the elected president, Gustav Petro, expects to present once he takes possession.
(See: BBVA Research estimates that the Colombian economy will grow 6.8% in 2022).
In conversation with him Financial Times, the economist highlighted the great tax burden on companies in Colombia and that the tax initiative being structured would focus on more taxes for wealthy individuals than for companies.
According to the Organization for Economic Cooperation and Development (OECD), only 5% of Colombians pay income taxes. AND
(See: Petro will seek to make the tax system more “fair and progressive”).
During the campaign, Gustavo Petro stated that he would contemplate imposing a wealth tax on the 4,000 largest personal fortunes and that more would be extracted from other people with high incomes.
“There are too many taxes on companies and not on individuals, and addressing the issue of income tax is essential if we want the system to be more progressive”, Ocampo told the British media.
In this sense, the Minister of Finance of the Petro government added that the corporate tax rate, which is currently at 35% due to the increase made during the pandemic, sand would gradually reduce.
(See: Duque’s questioning of reforms proposed by Petro).
“If you ask me, I think we should gradually go back to the level we had before, that is, 30%” said.
Elsewhere in the interview, Ocampo said the incoming government would respect the country’s fiscal rule and aim to reduce the deficit by 3 percentage points over four years.
In addition, he also tried to calm fears about the pension reform planned by Petro, saying it was not an immediate priority.
Finally, the economist referred to one of the president-elect’s proposals on the creation of a program in which the State would act as an employer, offering work to those who could not find it in the private sector.
(See: Inflation in Colombia is at greater risk by 2023, according to experts).
“Obviously, I have to see how we can deliver on what he (Petro) promised in the election campaign, but at the same time, he has to understand that obviously I have my point of view on the economy, which I hope he shares.Ocampo said.
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