The objective of last year’s much mentioned Financing Law is to obtain more resources to finance social spending without broadening the base of the Value Added Tax (VAT) on final consumers, and in turn, generate more employment, encourage private investment, boost economic activity and promote greater equity among Colombians. Companies will be able to deduct one hundred percent of the VAT they pay for purchases of capital goods and will be able to deduct from income 50% of the Industry and Commerce Tax for the taxable year 2019 and in its totality in 2022; the 1% tax rates for estates of more than $5,000 million are highlighted; the sales tax on real estate of more than $918 million is replaced by an excise tax on all real estate exceeding that value, except for rural properties destined for agricultural and livestock production.000 million; the sales tax on real estate over $918 million is replaced by a consumption tax on all real estate exceeding that value, except for rural properties used for agricultural production; and the income tax rate is increased for individuals with average monthly income over 40 million pesos.
Regarding free trade zones, it regulated and determined the VAT taxable base applicable to the sale of products manufactured by industrial users from 100% national components and/or in free disposal with destination Colombia. This regulation has generated controversy due to the lack of clarity in the procedure to be followed and the impact it could have on cash flow.
Between August and October, our general manager Manuel Herrera, together with the unions, has made a direct intervention with the National Government in order to clarify the regulations and to avoid any trauma at the time of complying with the regulations.
The action plan implemented by Zona Franca La Cayena with its users has the following components:
- – Working groups with industrial users who have expressed interest in identifying customs and tax impacts.
- – Training by DIAN in a computer systems testing environment: This training was held on October 8 and 9 with 13 users and 29 attendees.
- – Instructions for the creation of accounts in DIAN’s computer systems sent on October 11.
- – Finally, between October 15 and 18, we will be attentive to resolve your concerns, guide you in complying with customs and tax formalities, and support you in the construction of your internal procedures.
By: Oswaldo Torres Financial Manager Zona Franca La Cayena.
