After two days of debate, full sessions of the House and Senate approved it yesterday Tax reform About 20 billion pesos by 2023 from the government of Gustavo Pedro, the most ambitious goal in history. What follows is a reconciliation of the two texts – which are different – so that the plan gets the President’s assent and becomes an Act of the Republic.
(You may also read: Tax reform: Articles approved in the Senate)
“This reform is a major contribution to the transformation that the national government intends to force. Two elements are linked: we have a sound fiscal policy and guarantee that we have additional resources to promote social peace,” the finance minister assured. Jose Antonio OcampoWho said the money raised would go towards peace, education, health, housing and water, among others.
The President celebrated the approval of the reform and congratulated both Ocampo and Dion’s director, Luis Carlos Reyes, as one of the architects of the project’s success, through his Twitter account.
The government tabled the initiative on August 8, a day after the president’s inauguration, and thanks to his emergency message he had a brief procedure: The first approval in the economic commissions and the second – yesterday – in the plenary sessions of the Chamber and the Senate.
In these nearly three months of discussions with various political actors, businessmen and civil society, the initial target of 25 billion pesos fell short by 5 billion pesos. Issues such as pension tax, celebrating VAT-free days, cross-border petrol subsidies or taxes on oil, coal and gold exports also fell through.
How was the last debate?
Meanwhile inside Senate The debate was resolved after more than 15 hours on Wednesday, with delegates debating for two days and finally giving their approval yesterday. In both cases there was no shortage of criticism from Congressmen. Even the Democratic Center has already announced its demand for reform to continue to protect the “pocket of Colombians.”
Among the articles that have heated up the debate are highly processed foods and royalty-free.
Although most of the articles of the paper are approved by both parties, they differ in the text of the Chamber and the Senate, so they will be decided during the reconciliation. This is the 20 percent tax levied on churches when they do activities other than religious services, such as selling books.
Among the articles that fueled the debate on both sides were highly processed foods, Royalties are not deductibleSuch as foreign bases or prison changes for evaders.
Congress members from different benches said that in the first case, the most vulnerable people would suffer. “It won’t be normal or eating chocolate with bread. This reform doesn’t just touch the rich,” said Senator Jota Pe Hernandez.
Certain foods such as industrial bread, milk, honey, sandwiches, wafers, arecube, salami, mortadella and botifara were left out of the list of highly processed foods subject to tax, while others were chocolate, pastry, biscuits, jam, prepared sauces or ice cream, among others.
The non-deduction of royalties represents only a 3 percent surcharge on oil
According to Minister Ocampo, the tax will come into effect from September 2023 so that it will not affect people at this time of high inflation. For its part, the tax on sugary drinks will be in effect from July 1, 2023.
Another of the more controversial articles recently approved imposes an additional income tax on oil tankers and miners based on international prices over the last 10 years. Apart from this, royalty is not deductible. “It is incomprehensible that oil and coal are not doing it now. The impact is much less than what was thought. The non-deduction in royalties only means a 3 percent surcharge on oil. The Council of State has not ruled on it, there is only the Dian resolution that allowed it,” Ocampo told members of Congress.
As stated therein Jail for evaders, defined imprisonment only after the third revision. For example, a person who fraudulently or evasively excludes assets or declares undervalued or non-existent debts for an amount equal to or greater than the current statutory monthly minimum wage of 1,000.
Yesterday’s debate in the House contained several articles that delayed the debate. One of them is 48, which determines that non-resident or non-resident companies with a significant economic presence are subject to income tax, as in the case of Netflix, Disney +, HBO or Spotify platforms. . Certain activities like digital services or advertising services are taxed under this section; However, others such as online education services were eventually excluded.
What was approved
Tax reform brings a new set of taxes to Colombians. The biggest payers will be businessmen, of whom the biggest burden will be borne by those in the mining-energy sector.
Oil tankers and miners must pay a fee Rent is extra Varies with international prices of last 10 years. In the case of oil, it is progressive at 5, 10 and 15 percent; and in the case of coal, 5 or 10 per cent. Apart from this, royalty is not deductible.
Similarly, a temporary surcharge of 3 points (from 2023 to 2026) has been imposed on hydropower plants and financial institutions will reach 5 points.
Those who have more
It will be businessmen who will pay, and among them, those in the mining-energy sector will bear the brunt.
People will also have to pay more taxes. For rent, those earning more than 13 million pesos per month must contribute more. Likewise, large gardens will also contribute. The tax will be progressive with marginal rates: 0.5 percent for assets over 3,000 million pesos; 1 percent for over 5,000 million pesos and 1.5 percent for over 10,000 million pesos.
Don’t forget that people will also pay more with healthy taxes passed. On the one hand, there is a tax on sugary drinks, on the other hand, it Highly processed foods. Apart from this, single-use plastic products have been taxed. This may lead to double taxation of certain goods.