Three days without VAT and other tax reform measure announcements

The president, Iván Duque, announced a series of measures included in the tax reform which was filed by the executive. Among them are: three days without VAT per year, VAT refund to the most vulnerable, reduction of health contributions for pensioners and work incentives for young people.

Before the media, Duque said:

“One of the pending tasks we had in Colombia was to remove the burden of VAT from the most vulnerable families in Colombia, in this paper has incorporated the idea of returning 100% of VAT to the most vulnerable families in Colombia that are part of 20% of our population,” he said.

For retirees who receive pensions of one minimum wage, the idea is to gradually reduce health contributions from 12% to 4%. In principle, next year it will be reduced to 8 % and in 2022 to 4 %.

“The second thing, a longing that pensioners in Colombia have had and particularly the most vulnerable, which are those who have pensions of the order of a minimum wage that are about 50% of pensioners in Colombia, are going to have through this law the fulfillment of a dream and is the reduction of the health contribution that will start next year with the reduction from 12 to 8%, will continue the following year at 8% and will reach 4% in 2022,” he explained

He also emphasized that this law has been incorporated in the proposal to give more incentives to those who generate new youth employment in the country. Young people between 18 and 28 years of age may be hired and those who hire them may have an additional deduction to the one that currently exists in the law.

Finally, there will be three days without VAT per year in which families will be able to purchase clothing, footwear, supplies, some technologies, at lower prices since they will not have to pay this tax.

“I believe that a very important step has been taken and it is that Colombia is going to have three days a year without VAT, three days a year where families will be able to acquire, obviously with an amount that will be defined by the speakers and mainly for items such as clothing, footwear, supplies and also some technologies for young people that are required and for families”, said Duque.

Source: Actualícese