Colombia’s President Ivan Duque yesterday signed the Law 2010 of December 27, 2019 called the “Ley de Crecimiento Económico” or “Economic Growth Law” after it was approved by Colombia’s congress. The administration hopes the law will spur foreign direct investment and grow the country’s gross domestic product (GDP).
The law includes a tax credit designed to offset value added tax to the poorest 20% of households, about 2.8 million homes. It also reduces from 12% to 4% the health contribution of the country’s lowest income pensioners and includes incentives for hiring young employees between 18 & 28 years of age.
The measure establishes 3 days of value added tax holiday on clothing, school supplies, and some technology. The law is modified significantly from a tax reform passed a year ago but ruled unconstitutional on procedural grounds, and does not include many of the controversial proposals that prompted massive protests last month.
Businesses will also receive tax discounts on some imported capital goods, and simplifies tax filing processes for small and micro-enterprises.