Colombia softens tax proposals for oil and mining companies in tax projects, the collection would be lower

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BOGOTÁ, Sept 26 (Reuters) – Lawmakers and the Colombian government have agreed to ease tax rates for oil and mining companies to be included in a tax reform being processed in Congress, Finance Minister Jose Antonio said on Monday Ocampo.

The new proposal will allow mining and oil companies to continue deducting the royalties they pay from their income tax returns in exchange for introducing a 5% surcharge on the income tax of companies in the industry.

To compensate for the reduced resources, it was agreed to increase the extraordinary export tax rate from the original 10% to 20% on foreign sales of oil and coal.

The reference price would take into account the average price of the product over a period of the last 20 years.

Ocampo said that in the case of oil, the extraordinary exports tax rate would assume a base price of $71 a barrel, compared to the previous proposal, which started at $48 a barrel.

As for what the price would be in the case of coal exports, the official did not immediately go into detail, while scrapping the idea of ​​including foreign gold sales.

Meanwhile, Ocampo assured that the estimated incremental revenue from the fiscal project would likely not reach the 25 billion pesos expected in 2023 ($5,647 million), but refrained from giving further details.

In addition, a proposal for a carbon tax on petrol, petrol and diesel has been withdrawn to avoid impacting rising inflation.

The government expects further changes to the tax law next week.

Thousands of people demonstrated on Monday to reject the political, economic and social reforms planned by leftist President Gustavo Petro, who is facing his first opposition protest 50 days after taking office.

($1 = 4,426.47 pesos) (Report by Carlos Vargas, written by Nelson Bocanegra)

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