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Colombia’s finance ministry has stopped tax reforms


Colombia’s finance minister resigned on Monday after the government was forced to cut tax-deductible money, which led to six days of protests in the streets killing 17 people.

Alberto Carrasquilla said he was stepping down to allow the government to reach an agreement needed to pass taxes through a conference. President Iván Duque He said Carrasquilla has been replaced by Trade Minister José Manuel Restrepo Abondano.

The government provided tax reform, which the former finance minister made, at the Colombian congress last month. The goal was to raise 1.4 percent of total household income, or $ 4.1bn, by eliminating some of the contributions and raising taxes, among other things.

But a few days later, even parties that were expected to support tax reform rejected them. The Democratic Party’s right-wing Duque party urged the President and his finance minister to change the money.

Last Wednesday, thousands of people walked away in the streets against. The growth of the protests seemed to surprise the Colombian government by surprise and strengthening its organizers, for several days. The protests have become more violent and the government has deployed troops in some cities to restore order.

The state ombudsman’s office said Monday that 17 people, including one police officer, had been killed in clashes and 846 others had been injured, including 306 civilians.

Alberto Carrasquilla has resigned as finance minister to help the Colombian government agree to a tax reform © Bloomberg

Mr Duque said on Sunday his government would pay another tribute to Congress, highlighting some of the possible consequences.

This included short-term measures such as corporate income tax and increased wealth and tax divisions in Colombia as well as increased revenue. The system of raising additional taxes on goods and services will be abolished.

“The fact that the new bill would have been temporary. . . it means that showing that the country is committed to change is now weak, “Citibank experts wrote.” This does not make sense for the accounting agency. “

The program of changes in taxes is the most important law in Colombia this year. The income situation in the country depends on this.

Both Fitch and Standard & Poor’s voted for Colombia three times in B with a misdemeanor on offering a long-term loan. This is just one of many pitfalls that are worthless or worthless. Moody’s voted for Colombia Baa2, two notches on top of nonsense.

If the tax reform process fails or melts away, there is a good chance that Colombia will be excluded from a small group of Latin American countries including Mexico, Chile and Peru.

This can be painful for a country that even has one a long civil war and a well-known lawlessness, boasting of economic deprivation. In stark contrast with many other countries in the region, Colombia has not changed its debt since the 1930’s and has had access to finance since 2011.

While tax cuts and Carrasquilla’s resignation could end the crisis, protesters have vowed to return to the streets on Wednesday.


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