Higher income for individuals?

Removing some income benefits and having more people declare and contribute to this tax could be another alternative to increase tax collection.

According to a Dian report, 18.5% of the fiscal cost of these exemptions comes from income, which represented $17.1 trillion in 2019. This barely represents 1.6 % of GDP and 65 % corresponds to exempt income; 30.1 % to tax discounts and 4.9 % to the deduction for investment in fixed assets.

On the other hand, the largest contribution to this tax is made by companies, since according to OECD calculations, in the country 20.1% of income tax collection is contributed by individuals, and the rest by organizations. And according to the Dian, these benefits to companies are also concentrated in some sectors, since of the 32.500 organizations that used these discounts, 21.5% belonged to manufacturing industries, 20.3% to commerce, 16.9% to financial and insurance activities, 12.6% to mining and quarrying, 9% to electricity and gas supply, and the rest is distributed in other sectors.

Thus, Colombia is below the average of other Latin American countries, emerging countries (Brazil, Chile, Peru, Mexico, Philippines, Malaysia, Thailand, South Africa, Turkey and Bulgaria), and the OECD, since the participation of natural persons is 39.3 %, 45.1 % and 73.5 %, respectively.

Source: Actualícese