Although the National Government did not publicly share the wording of the billed called "social investment” that contains among others, changes in the Colombian tax law and that will be filed in the coming days before the Congress of the Republic so that this entity discusses and approves it as a Law, the President did publicly explain it in the afternoon of this July 13, 2021.

As per the informed by the National Government, the purpose of the reform is:

a.    Extension of the solidarity income program

• The program goes up to 2022.
• Current beneficiaries will be maintained in the program, but the program will be extended to new beneficiaries so that the program reaches 3.3 million households.

b.    Expansion of the PAEF payroll subsidy (Support Program for Formal Employment)

• The program goes up to December 2021
• The program will be focused on small companies and will include individuals with more than 2 employees.

c.    Support to employers in order to encourage the hiring of young people

d.    Greater resources for the “zero tuition” program and maintaining incentives and better conditions for users of ICETEX educational credits.

From the tax standpoint of view, the following measures were announced:

e.    Strengthening of formalization and greater efforts to fight against tax evasion

• National Tax Authority (DIAN) will be granted with powers to send income tax returns to those who must declare and pay said tax and fail on this.
• It will be allowed to invoice the income tax based on the information of the electronic invoice and based on the information reported by third parties
• The Unique Registry of Final Beneficiaries will be created and implemented in order to identify the owners of companies so that they can meet their tax obligations
• A georeferenced information system will be implemented to detect the real value of declared real estate property.

f.    Call for the business sector solidarity:

• The tax credit of the industry and commerce tax against the income tax is reduced from 100% to 50%.
• The income tax rate for entities is increased from 30% (taxable year 2021) to 35% as of taxable year 2022.
• The surcharge applicable to the financial sector goes up to 2025.
• Tax normalization will be allowed for 2022.

We expected receiving the wording of the draft bill proposed by the National Government in the next few days.