The Colombian government declared this Monday an “economic and social emergency” for a period of 30 days, after the country’s Congress in early December repealed the tax reform with which the executive wanted to raise 16.3 billion pesos (around 3.7 billion euros) to complete the 2026 budget.
Colombian President Gustavo Petro has therefore signed a decree that affects the entire national territory and will allow him to authorize new taxes, claiming that it is “materially and legally impossible to guarantee the effective exercise of some fundamental rights and the provision of essential public services on a continuous, timely and sufficient basis”.
The president argued that this had led to a “financial situation that has taken on a serious character” after the Legislative Assembly rejected on December 9 the reform that would allow it to raise 12,000 million pesos (around 2,700 million euros) “for the 2025 financial period.”
The Colombian Executive has also indicated that it was prompted to take this decision by: compliance with the order of the Constitutional Court regarding the Health Capture Unit (UPC), the amount that the Administration pays to the Health Promotion Companies (EPS) for each member to finance their medical care; the need to ensure the security of citizens in the face of disruptions to public order, to confront the outstanding payments of the previous administration and the debt restrictions resulting from the “unilateral actions of the United States”.
According to Caracol Radio and El Espectador newspaper, Petro’s announcement comes at a time when he is expected to enact new taxes in the coming days, including a wealth tax on legal entities, an increase in VAT and excise taxes, and new taxes on alcoholic beverages, tobacco, some highly processed foods and fossil fuel extraction.
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