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Colombia

Another tax reform in the pipelineGómez-Pinzón y Asociados, Bogota

In an attempt to reduce the state's deficit, the Colombian government introduced a new tax bill before Congress. The aim is to increase the collection of taxes by 3.8% of the GDP. The measures contemplated by the bill include, among others:

Financial transactions tax (Gravamen a los Movimientos Financieros)

This tax will apply to financial transactions for the withdrawal of cash deposited in savings or current accounts, or with the Central Bank, as well as for the issuance of cashiers cheques (cheques de gerencia). The rate of the tax will be 3/1000.

Some financial transactions will be exempt from the tax, including transfers between current accounts in the same bank and of the same holder, inter-banking credits under certain conditions, and sale and purchase of currencies performed by stock exchange brokers under certain conditions.

Income tax

  • The presumptive income will now be calculated on the basis of the greater of 6% of the liquid net equity and 1% of the gross assets;
  • Income tax withholding will increase up to 6% for services fees and 12% for consulting fees; and
  • Assets held abroad by Colombian taxpayers as of December 31 1999, not declared in the corresponding tax return, may be repatriated without being audited by the tax authorities, but are subject to a 3% special contribution.

Value added tax

  • Increase of the normal rate from 15% to 16%;
  • Cigarettes and cigars subject to 16% VAT; and
  • Amount of the withholding for big taxpayers up to 75% (instead of 50% of the VAT due).

Customs tariffs

Special customs tax of 1.2% calculated on the FOB value.

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