Sunday, 27 September 2020

Colombia Mulls Hike In Value Added Tax (TAX)

Colombia Mulls Value Added Tax (TAX) Hike

(TODAY COLOMBIA) Colombia is due to hike its value-added tax (VAT) rate to 19 percent from 16 percent.

The measure was included in a tax reform bill that was recently approved by Congress. The hike would come into effect from 2017.

The VAT cut would be accompanied by tax cuts for companies and more stringent penalties for tax evaders.

The VAT is Colombia’s main indirect tax. Currently this tax is 16 percent of the price of merchandise, goods and services with some exceptions: public transportation, water supply and sanitation and the transportation of natural gas and hydrocarbons.

- paying the bills -

The the National Taxes and Customs Direction (DIAN) recognizes two separate categories (regimenes) of VAT: common and simplified. The first refers to businesses with estimated patrimony over 68 million Colombian pesos (about US$34,000 dollars), and the second refers to those with patrimony less than that. Although both are obligated to pay the same percentage, the simplified taxpayers are not obligated to conduct separate bookkeeping for the VAT or to generate invoices.

Other taxes in Colombia include the stamp tax, a tax on the expedition of an official document (or on the validity of private documents), such as a contract or contractual modification; Financial transactions tax, A 0.4% tax rate is imposed on all financial transactions, including withdraw money from ATM, etc: Patrimony tax, a tax that requires the annual payment of 0.3% of the total patrimony of people with patrimony estimated over 3 billion pesos (about 1 million USD); Income tax; Payroll taxes; and Local taxes.

Corporations Income tax (Spanish: Impuesto a la renta y complementarios) must be paid by all local and foreign corporations operating in Colombia, who are subject to a corporate tax of 25%.;

Personal Income tax: Colombian citizens and foreign nationals who have lived continuously in Colombia for a total of 183 days, are thereafter subject to individual Income tax based on a system of graduated marginal tax rates.

- paying the bills -

Payroll taxes: Both the employer and the employee are subject to monthly payroll taxes from the employee’s gross salary, as follows:

Employer:
Health plan – 8.5%
Occupational risk – 0.348% – 8.7%
ICFB (Instituto Colombiano de Bienestar Familiar; Family Welfare) – 3%
CAJA (banco caja social) – 4%
SENA (The National Service of Learning) – 2%
Pension fund – 12%
Vacation – 4.17%
Employee:
Health plan – 4%
Pension fund – 4%

Local tax: tax is applied to lottery winnings; tax on gasoline, beer, liquor and cigarettes; and property tax, among others

Article originally appeared on Today Colombia and is republished here with permission.

Q24N
Q24N
Q24N is an aggregator of news for Latin America. Reports from Mexico to the tip of Chile and Caribbean are sourced for our readers to find all their Latin America news in one place.

Related Articles

President signs law that frees tourism of VAT for another year

(QCOSTARICA) President Carlos Alvarado, this Tuesday singed the law that exempts,...

Every colon counts for the 1.2 million Ticos hit by the VAT

(QCOSTARICA) The entry into force of the 1% of the Value...

MOST READ

COVID-19 Costa Rica: 1,370 new cases and 21 deaths for Sept 23

(QCOSTARICA) For Wednesday, September 23, the Ministry of Health reported 1,370 new cases of COVID-19, of which 228 are by epidemiological link and 1,142...

Costa Rica ranked 13th in best countries for gender equality

(QCOSTARICA) First published in 2006 by the World Economic Forum, the Global Gender Gap Index measures gender equality in 153 countries by tracking and ranking...

Costa Rica negotiates with 6 pharma for the COVID-19 vaccine

(QCOSTARICA) The government of Costa Rica has already started talks with six pharmaceutical companies for the future purchase of the COVID-19 vaccine. The acting Minister...

Costa Rica extends tourist visas until March 2, 2021

(QCOSTARICA) Costa Rica's immigration service, the Dirección General de Migración y Extranjería Costa Rica (DGME) announced today, Monday, September 21, the extension of tourist...

Blame the drivers: It’s not the posts, but the lack of road safety education

(QCOSTARICA) The installment of the flexible delineator folding posts on the Ruta 32, at a cost of ¢177 million colones Sunday morning is failing...

Playa Hermosa becomes the first World Surf Reserve in Central America

(QCOSTARICA) After a close competition in which the best waves from all continents participated, Playa Hermosa de Garabito, Puntarenas, was designated as the most...

Let's Keep This Going!

To be updated with all the latest news and information about Costa Rica and Latin America.

Article originally appeared on Today Colombia and is republished here with permission.

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.