• Suspended the tax increase in 2021 for residential and non-residential properties valued up to 150 legal minimum monthly wages (i.e. COP 147,098,550 in 2020, ~USD40.000).
• For properties valued higher than 150 legal minimum monthly wages the same tax of 2020 will be paid in 2021; and if there are any appraisals in value, the tax due can only increase as much as the inflation for 2020,.
• The measure does not apply for non-urbanized properties that can be constructed, nor for unproductive properties.
• The payment of property tax is frozen for 2.6 million owners
• Tax exemptions of up to 80% for schools and kindergartens.
• Payment by installments of the property tax for residential and non-residential properties will be allowed – pending regulation by the Mayor’s office.
• The property tax rate increase for the residential properties of greater value of the city will not be granted any incentives; that is, the residential properties with cadastral valuation from 1,092 million pesos.
• Theaters, museums and cultural centers are exempt in 100% of the property tax, for the years 2021 and 2022, and 70% until 2030.
Industry and Commerce Tax
• For those taxpayers who in 2020 have had a reduction in their taxable income due to COVID, a discount on the Industry and Commerce tax for 2021 was approved. The amount of the tax credit will vary, depending on the proven reduction in the revenues. The most affected companies will have discounts of up to 25% of the tax due.
• Similarly, there will be an increase in the tax rate for taxpayers who have grown in their income.
• Starting in 2022, an increase in the Industry and Commerce tax was approved, for the following industries:
o manufacture of pharmaceutical products, medicinal chemicals, and botanicals for pharmaceutical use.
o construction of roads and railroads.
o construction of public service projects.
o construction of other civil engineering works,
o wire and wireless telecommunications activities, and
o financial activities.
• The construction and maintenance of parking lots will have a tax discount in the Industry and Commerce tax for of up to 120% of the investment made on the project for the first year, and 5% for four (4) more years.
SIMPLE Regime and other provisions for business formalization
• The national SIMPLE Taxation Regime is adopted in the Capital District, as well as the consolidated Industry and Commerce tax rates for those taxpayers.
• Incentives for business formalization, including tax discounts for financing the registration and/or renewal of the business, progressive Industry and Commerce tax rates, and preferential loans.
• Tax discount on motor vehicle tax of 60%, 70% and 40% for new electric vehicles, new or already registered electric cars and new hybrid/electric vehicles, respectively.