Monday , October 25 2021

Tax reform – LANACION.COM.CO



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Rodrigo Villalba Mosquera

The name of the bill submitted by the government with a huge taxfall in taxes must be the tax reform rather than the financing law. They did so to give them a well-meaning name under the 2019 budget, under-employment, with a deficit, according to the government, 14 trillion pesos. It is not a financing law, because the income received has its preference for permanence. In fact what is being sought is a funding not only for the 2019 loss but for the Duque quadrennium development plan. This is not bad, the problem is that we are in a "bad times" situation and that the approach of reducing burdens on business and incentives to capital goods on the one hand and the other side of the coin is appalling. cabuya ", to extend the taxable VAT base to 73 products – including family basket products – and to increase the rate of leasing to natural persons.

Experts who have been advising governments for decades have always recommended to declare everything, so there is a possibility of return, but that is not easy, unpalatable and political costs in the legislative process. There is no tax culture here, there is a very large gap of inequality (let us remember that we are in the third most unequal country in the world) and a strong mistrust in the good distribution of public resources.

It seems that the government deficit is not so high because it does not count the higher revenues from the best oil prices or future concessionality-related concessions (most of the 4G routes) that could fall and release billionaires resources. Under these circumstances, the deficit could be 7 or 8 billion.

The government was merciless. Collection of tax reform is based on the highest VAT that would give it 11.3 billion, without providing an alternative for funding. So far, they call on guilds, political parties and other actors in national life to help them look for them.

"The stick is not for spoons," the guilds themselves are considered skeptics. Word and thanks to ANIF that fears that in 2015 it will reduce revenue with this tax initiative and reduce certification by rating agencies, having a negative impact on borrowing and debt rates. Fedesarrollo goes further and ensures that this reform is inflationary in at least 4 additional points.

For those of us who are responsible for the process of tax reform, we must give peace to the mind that will be considered under the responsibility of the country, analyzing other funding possibilities that are less damaging to the Colombian pockets. I assure you that this reform will not leave Congress as it entered.

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