Colombia

Colombia is entering a period of political transition following the recent presidential elections, with the incoming administration expected to take office on 7 August 2026. While it is generally anticipated that tax policy will form part of the new government's agenda, no official tax reform proposals or policy announcements have been released to date. As such, there remains limited visibility regarding the direction of future tax measures.

Against this backdrop, on 20 July 2026, the outgoing administration submitted a tax bill to Congress. The proposal includes several measures that would transform temporary provisions implemented through emergency decrees into permanent legislation, including: (i) a 1% tax on the production and export of crude oil and coal, (ii) the elimination of the reduced 5% VAT rate applicable to hybrid vehicles, which would become subject to the standard 19% VAT rate, (iii) additional VAT measures affecting online games of chance, and (iv) the revision or elimination of certain preferential tax treatments and incentives, among others.

At this stage, it remains uncertain whether the bill will gain significant traction in Congress given the imminent end of the current administration's mandate and the absence of any public endorsement from the incoming government. Consequently, although further tax developments are expected in the near future, it is unclear whether the current proposal will progress in its present form or whether a new reform initiative will be introduced once the new administration assumes office. We will continue to monitor legislative developments closely and assess any potential implications as additional information becomes available.