The project of tax reform law for Equality and Social Justice, as the article was called by the Government of Gustavo Petro, it was filed this Monday, August 8 for its socialization and analysis.
(The Petro Government officially files the tax reform project).
In general terms, the initiative that will be debated in the Congress of the Republic, proposes to limit the tax benefits for people who have incomes greater than ten million pesos per month, and who, according to government calculations, they only represent two percent of the population.
In this line, all income will be unified and from this measure the taxpayer will pay in the same way for occasional earnings and dividends as he does today for labor income.
A worker who earns less than $10 million will not pay more taxes.
For their part, people with assets of more than $3,000 million will pay a rate that starts at 0.5%. Those with assets greater than $5,000 million will pay one percent.
(Tax reform would achieve additional sources for $25.9 billion).
“This tax reform project aims to advance fundamentally in two dimensions: first, to reduce the inequitable exemptions enjoyed by individuals with higher incomes and some companies, as well as to close paths for tax evasion and avoidance; and second, in achieving sufficient resources to finance the strengthening of the social protection system. The foregoing is achieved through adjustments to the tax system, which allow progress in terms of progressivity, equity, justice, simplicity and efficiency.”indicates the initiative filed before the Presidency of the House of Representatives.
The initiative also offers new tools to the tax administration to better control evasion in Colombia, since according to various studies in the country, evasion can exceed $50 billion. The anti-evasion regulations will be complemented with an additional advance in the modernization of the Dian.
The proposal does not contemplate an increase in the taxes paid by the national productive apparatus, but the tax benefits will be limited.
In line with international policies, the initiative will allow the redistribution of the benefits generated by the high prices of oil, coal and gold. To this end, a tax is established on the export of these products equivalent to 10% of the excess over a base price.
Namely, if the price of oil is US$95 per barrel and the reference price (set by the National Hydrocarbons Agency, ANH) is US$48, the approximate tax is 4.6% on extraordinary exports.
(Tax reform raises tax on oil, coal and gold).
The project includes taxes on carbon emissions and public health, that is, those that cover sugary drinks and ultra-processed foods.
It should be noted that the carbon tax is levied on the equivalent carbon content of all fossil fuels, including oil derivatives and all types of fossil gas that are used for combustion.
Added to this, the deduction of royalties from the Income Tax will not be allowed. The foregoing, because royalties are payments made by companies for the exploitation of a property of the Nation.
In addition to proposing the elimination of the three days without VAT, the need to collect this tax is put on the table when goods enter the national territory, whose value is even below US$200 and come from countries with which Colombia does not have Free Trade Agreements in force. This implies that goods originating in the United States are exempt from this tax, but not those that are not produced in that country.
There will be no VAT for the family basket.
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