Since 2024 the Colombian Government tried to introduce a number of changes to the Tax Code, chiefly to increase the tax burden for taxpayers. The 2024 tax bill did not pass muster with Congress and was thus filed.

The Government then resorted to Constitutional Internal Commotion powers by means of Decree 064 of January 24, 2025, and, based on the authority granted by this decree, issued several tax reforms, whose life was limited to 2025.  

Thereafter, on September 1, 2025, the president of Colombia submitted to Congress a bill for a new Financing Law, which sought to incorporate, on a permanent basis, the temporary taxes in the Internal Commotion decrees as well as other tax provisions, including:

1. Value -added tax (VAT):

• Online gambling, whether operated in Colombia or from abroad, would be subject to VAT.
• VAT on slot-machine gambling.
• Progressive VAT basis for gasoline and other fuels.
• VAT on liquor, wines and aperitifs.
• Software licenses for the commercial development of digital content, as well as hosting and cloud computing services would become subject to VAT.

2. Tax increases:

• Increase in the income tax rate for e-commerce from outside Colombia, from 3% to 5% of gross revenues, for nonresident taxpayers electing this mechanism.
• Increase of the corporate tax rate for financial institutions from 35% to 50%
• Increases of between 0% and 15%, for CIIU-0510 and CIIU-0520 coal and CIIU10610 petroleum extraction activities.
• Increase in the tax rate for individuals, up to 41%.
• Increase in the withholding tax rate for dividends paid from previously taxed earnings to nonresident individuals and legal entities, from 20% to 30%.
• Increase to 30% for dividends paid from previously taxed earnings to permanent establishments in Colombia.
• The floor for the wealth tax would be reduced to 40.000 UVT, while the maximum tax rate would increase from 1.5% to 5%.
• Increase in the rate for lottery, raffles, betting and similar income, from 20% to 30% over the prize received.
• The National carbon tax would increase to $42,609 pesos per CO2 ton, and adjusted yearly by the Colombian inflation plus 2%, up to $149,397 pesos per ton.  This increase would also tax thermal carbon gradually, by 40% of the tax rate in 2026, 60% in 2027, 80% in 2028 up to 100% in 2029.

3. Other taxes:

• The holding period for the sale of fixed assets to qualify as a capital gain and thus entitled to the flat 15% rate, would be increased from 2 to 4 years.
• The 2015 1% tax on extraction and first sale or export of crude oil and coal for taxpayers with taxable income in the preceding year equal to or exceeding $2,489,950,000 Colombian pesos would become permanent under the proposed bill.
• Entertainment, cultural and sporting activities would be subject to a 19% consumption tax on the ticket price exceeding $497,990 Colombian pesos.
• New consumption taxes would also apply on the sale of vehicles, beer and other fermented drinks, liquors, cigarettes, tobacco and vapers.

4. Cryptocurrencies:

• The transfer of cryptocurrency with underlying assets in Colombia would be taxed, as if the underlying asset itself was being transferred.  
• Payment of assets located in Colombia, with cryptocurrency would be considered sales of the crypto and subjected to Colombian taxation
• Similarly, cryptocurrency would be deemed held in Colombia when the underlying assets are located in country.  T
• The providers of digital services domiciled in Colombia or with operations in Colombia would be required to report to the tax administration, all operations carried on by their users which imply the conversion of cryptocurrencies into Colombian pesos

5. Tax amnesties. On the bright side, the bill was proposing the following amnesties:

• Taxpayers, omitting assets or declaring nonexistent liabilities would be allowed to regularize by paying a 15% tax on the tax basis of the assets or the tax value of the liabilities. These assets or liabilities would not be taken into consideration in determining the net worth comparison or taxable income.
• Taxpayers would be allowed to pay tax, customs, or exchange control liabilities, pending on December 31, 2024, by paying the entire liability +15% of the corresponding penalty and with a reduction in interest if paid before December 20, 2025 or, if paid later and up to March 31, 2026, the penalty would increase to 40% and the interest to 50% of the banking interest rate
• An amnesty was contemplated for settlement of court actions against the tax administration, where the taxpayer would agree to pay the entire tax and only between 15% and 20% of the penalty, indexation and interest.
• Unpaid withholding taxes could be paid up to March 31, 2026, with only 15% of the corresponding penalties and with no interest.

Again, however, on December 9, 2025, Congress decided not to approve the bill on grounds that it was simply revenue oriented, regressive and increased tax pressure on Colombia’s middle class.

You would think this was the end of the story.

Not so.

On December 22, 2026, the President again invoked Constitutional powers, this time under Economic Emergency clause, and issued Decree 1390, that grants the President a 30-day authority to issue various decrees, including in tax matters.

No such decrees have been issued as of the date of this writing.

But… stay tuned!