The Colombian Government issued Decree 1474 due to an Economic Emergency, introducing temporary tax measures for 2026 to address a fiscal gap. VAT and excise tax increases apply to liquor, cigarettes, and certain vehicles. Equity tax threshold lowered and progressive rates increased. A special 1% tax on hydrocarbons/coal is extended, and a 19% normalization tax on undeclared assets initiates. Penalties for tax controversies are reduced.
Colombia Approves Temporary 2026 Tax Hikes on Alcohol, Tobacco, and Imports
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Author: Ema Stamenković
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Content accuracy validation date:
26.01.2026
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08:08h
The Colombian Government issued Decree 1474 under special powers granted by the State of Economic Emergency (Legislative Decree 1390/2025). The decree introduces temporary tax measures effective throughout 2026 to close the 2026 fiscal gap after Congress rejected the Government’s September 2025 tax reform proposal.
Background
The 2026 budget was approved unbalanced in October 2025. Congress rejected the tax reform bill submitted on 1 September 2025. The Government declared an Economic Emergency to enact temporary revenue measures. The validity of the emergency has been questioned (not unforeseen; alternatives available), and the Constitutional Court is expected to review its constitutionality soon.
VAT and consumption/excise taxes
- Liquor, wine, and similar: VAT increased from 5% to 19%; plus excise: COP 750 per degree of alcohol in 750-cc container (or proportional) + 30% ad valorem on final consumer price.
- Cigarettes/manufactured tobacco: excise = COP 11,200 per box of 20 (or proportional) or COP 891 per gram chopped tobacco + 10% of final consumer price (for chopped tobacco, 10% applies to the specific element).
- Derivatives/substitutes for cigarettes: 30% of retail price + COP 2,000 per ml.
- Courier/urgent shipments exemption reduced to ≤ US$50 (previously ≤ US$200).
Consumption tax increases:
- From 8% to 19% for motorcycles >200 cc, yachts, pleasure/sports vessels;
- From 16% to 19% for certain vehicles/pick-up trucks (fob ≥ us$30,000) and certain aircraft (planes, helicopters).
Equity tax
- 2026 threshold reduced to 40,000 TU (≈ COP 2.905m / US$551k) from 72,000 TU (≈ COP 3.771m / US$992k).
- Progressive rate now 0.5%–5% (previously 0.5%–1.5%).
- No equity tax on companies filing CIT returns (contrary to initial speculation).
Special Tax for Fiscal Stability (hydrocarbons & coal)
- 1% tax on first sale/export of hydrocarbons/coal (tariff headings 27.01 and 27.09), originally introduced in 2025 under State of Internal Unrest, extended through 2026.
Normalization tax (tax amnesty)
- New 19% tax on undeclared assets or non-existent liabilities as of 1 January 2026.
- Rules follow prior normalization taxes.
- Return and payment due by 31 July 2026.
Measures to advance payments and resolve controversies
- Collection-stage cases (as of 31 Dec 2025): penalties reduced to 15%, interest to 4.5% p.a.; full payment by 31 March 2026.
- Non-filings (as of 30 Nov 2025) & amendments (by 31 Dec 2025): penalty reduced to 15%; filing + payment by 30 April 2026 (no late-payment interest).
- Litigation cases:
- First-level/only court: 15% penalty (85% reduction), 4.5% interest; request by 31 May 2026.
- Second-level court: 20% penalty (80% reduction), 4.5% interest; request by 31 May 2026.
- Omission of formal obligations: cure by 30 April 2026 with penalty of 3% of 2024 gross income (capped at 1,500 TU ≈ COP 79m / US$21k).
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