After taking office, Petro presented a tax reform to raise taxes on the richest

The initiative seeks to “strengthen the taxation of subjects with greater taxpaying capacity” and reduce exemptions to “the wealthiest”, according to an official summary shared with the media.

The Minister of Finance, José Antonio Ocampo, explained that the tax burden will fall on natural persons who earn more than 10 million pesos per month (about 2,300 dollars), which represent 2.4% of the population of 50 million inhabitants.

“The largest increase is only for some 34,000 people” considered as the “ultra-privileged in the Colombian tax system,” added Ocampo.

It also sets new taxes on wealth, sugary drinks and ultra-processed products such as sausages, on inheritances and occasional winnings, for example lottery prizes.

With the reform, the Petro Government aspires to receive 25 billion pesos by 2023 (US$273 billion), which is equivalent to 1.72% of GDP, and 50 billion by 2026 through more effective collection.

According to the government, tax revenues today represent 13% of GDP, below the Latin American average (14.8%).

Petro came to power with a plan of profound reforms that aim to strengthen the State, reduce poverty that punishes 39% of Colombians and reduce the gap between rich and poor, the widest in the region according to the Gini inequality index. .

However, it receives finances hit hard by the pandemic, with an estimated fiscal deficit of 5.6% of GDP for this year and a public debt of around 56.5%.

In 2021, the government of Iván Duque tried to tax the middle class to deal with the ravages of the health crisis, which sparked violent protests that lasted for two months and left 46 dead, including civilians and police, according to the UN.