Colombia's Ministry of Finance proposes tax reforms for 2026 budget, aiming to raise COP 26.3 trillion, including reduced VAT rates for hybrid vehicles, increased financial sector surcharges, and reduced personal income tax.
Colombia 2026 Tax Reform Proposal
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Author: Ema Stamenković
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Content accuracy validation date:
30.09.2025
Content accuracy validation time:
08:22h
On September 1, 2025, Colombia’s Ministry of Finance submitted a tax reform bill to Congress for the 2026 budget, aiming to raise COP 26.3 trillion. The bill reforms VAT, personal income tax, net wealth tax, capital gains tax.
Main Measures:
- Hybrid Vehicles: 5% reduced VAT rate eliminated.
- Financial Sector: Surcharge on financial institutions rises to 15%; coal and oil sector surcharges harmonized.
- Tourism Services: VAT exemption for tourist services used by foreign residents in Colombia removed.
- Liquid Fuels: Preferential VAT rates phased out (2026–2028); gasoline/diesel at 10% VAT temporarily, then standard rate; ethanol/biofuels shift to standard rate.
Personal Income Tax: Top marginal rate increases to 41% for incomes above 31,000 UVT (2025 UVT = COP 49,799).
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