News Latin America The pension tax is no longer included in the tax reform

The pension tax is no longer included in the tax reform

“This morning we have modified two aspects of what has been debated so far by the third joint commissions of the Congress of the Republic. One aspect, we are not going to present a tax on pensions”, says President Gustavo Petro after meeting with the congressmen who are rapporteurs for the tax reform in the House of Narino. “Second aspect, we modified the taxation of the hydrocarbon sector.”

After criticism from different benches that support Petro at different points of the project presented by the Government on its first day, this Tuesday’s meeting seeks that the text that reaches the final debate in the plenary sessions of the Senate and the Chamber has all the support possible. Hence, the president explained what was agreed at a press conference in which he was accompanied by congressmen from all the government benches, from the Conservative Party to the Historical Pact. And he announced that the tax reform will no longer seek to collect 22 billion in 2023, but around 20 billion.

On pensions, the initial proposal included taxing with income tax those that are 10 million pesos per month (about 2,000 dollars) and more, and the Conservative Party had proposed doing it from 13 million. Finally, none will pay rent, something that hits one of the central messages of the Government with the reform, which was to charge more taxes to the more affluent.

Regarding the hydrocarbon sector, on which a very substantial part of the reform falls, the idea that its contribution is more in line with the reality of its businesses. The reform maintains the idea of ​​a surcharge on income tax, but now for a variable percentage that will depend on the value of coal and crude oil in international markets: the higher the price, the higher the surcharge. For oil it will be 0%, 5%, 10% and up to 15% when the price of crude oil is higher than the average of the last 20 years; that of coal will reach 10%.

The other point, the most criticized by the companies in the sector, has not changed. It is about not allowing the royalties paid to the Nation to extract the products to be deducted from the income tax, something that they can do today. In it, the Government and its congressmen ratify themselves, under the argument that hydrocarbons, according to the Constitution, are assets of the Nation and royalties are the price paid by private parties to extract them.

Petro also explained that the idea is that the speakers write the text that will go to the plenary sessions this weekend, so that it can be approved the first week of November.

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