Colombia to propose wealth tax in new tax reform Bill

On April 5, the Colombian Ministry of Finance’s tax reform Bill was presented to the Congress of the Republic of Colombia.

In the wake of the Covid-19 pandemic, the aim of the reform is to reduce the country’s fiscal deficit, probably also through a one-time wealth tax estimated around 2%-3% that would hit Colombian taxpayers with net assets over 5’000 million COP (roughly USD 1.4 million). Further measures are expected to be implemented in order to tax large companies

To encourage investments, the Bill also proposes the removal of a 5% withholding tax paid by foreign investors in the Colombian bond market.  

The proposal is now in the hands of the Congress which will most likely approve it by July 2021, with the aim to implement it starting from 2022.