Why does the tax reform not resonate with businessmen and traders?

The Andi does not want the VAT to be touched, nor the income tax for individuals.

For Fenalco, under the current conditions Colombians are not prepared for a tax reform.

Acopi asked the Government to increase the amount of the payroll subsidy. The National Association of Colombian Businessmen -Andi- does not like the idea that the National Government has of increasing the VAT base or the modifications to the income tax for individuals.

The modifications proposed by the Government are not well seen by the Andi, at least in the short term, so it recommends not to make them. For the entity, there are other alternatives to increase tax revenues without affecting the citizens’ pockets. Bruce Mac Master, president of the Andi, explained the following in an interview with La FM:

With our proposal there is an alternative that would eventually allow not touching the VAT, neither touching the income of natural persons, especially of middle class people at this moment of the economic situation of the country.

The guild proposes three points, through which 13.7 trillion pesos would be collected:

1.To postpone the benefit of the ICA refund, with which a collection of 7 trillion pesos would be aspired.

2.To postpone the reduction of the corporate income tax, which would raise 5.7 trillion pesos.

3.Maintain the wealth tax for two years, which would raise 1 trillion pesos per year.

Mac Master says: With the first two items we would have 12.7 trillion pesos that would be available practically immediately and thus not touching the pockets of the middle class.

“this is an opportunity to play well with public finances and postpone benefits that are important for the country’s competitiveness.”

For him, this is an opportunity to play well with public finances and postpone benefits that are important for the country’s competitiveness, “but that in an act of strong solidarity the business community can temporarily waive them to help”.

The leader stressed that the country must meet great needs, so it is convenient to postpone the implementation of structural changes for a more favorable time.

For him, this is an opportunity to play well with public finances and postpone benefits that are important for the country’s competitiveness, “but in an act of strong solidarity, the business community can temporarily waive them to help”. The leader stressed that the country must meet great needs, so it is convenient to postpone the implementation of structural changes for a more favorable time.

For Fenalco, the tax reform is unfeasible at this time.

Jaime Alberto Cabal, president of Fenalco, the merchants’ union, stated on April 6, 2021 that under the current conditions the country is going through, Colombians are not prepared for a tax reform:

Neither the pandemic, nor the restrictions derived from this conjuncture are close to ending and on the other hand the economic reactivation is far from arriving, as was demonstrated during the last fortnight of March and the first half of April.

For him, to the uncertainty generated by the increase in the restrictions to mobility and business operation is added the threat of a tax reform that intends to collect 25 billion additional pesos: The only thing that seems clear is that both businessmen and employees, as well as consumers are subject to a new and abrupt change in the rules of the game, sowing great legal instability.

More taxes would be detrimental to economic reactivation.

The vice-president of Acopi Bogota, Maria Alejandra Osorio, told the media that imposing more taxes in the midst of this situation is detrimental to the economic reactivation that is required:

The consequences of these closures on companies are harmful and will make the incipient economic reactivation take longer. For this reason, we ask the Government to extend the amount of the payroll subsidy and we also ask not to file the tax reform at this time.