Context and Purpose
Decree 1474 was issued on 29 December 2025 under the State of Economic Emergency declared by the Colombian government. Its primary goal is to address fiscal gaps and fund the 2026 national budget after Congress rejected a proposed tax reform. The measures are temporary and apply throughout tax year 2026. [globaltaxnews.ey.com], [kpmg.com], [rmcsas.com.co]
Key VAT Measures Introduced
- VAT on Alcoholic Beverages
- All liquors, wines, aperitifs, and similar products are now taxed at 19% VAT (previously 5%).
- 5 percentage points of this VAT remain allocated to departments under Law 1816 of 2016. [kpmg.com], [pgplegal.com]
- VAT on Online Gambling
- Online games of chance operated exclusively over the internet are subject to 19% VAT.
- The taxable base is gross gaming revenue (bets minus prizes) for each two-month period.
- Applies to operators in Colombia and abroad. [kpmg.com], [linkedin.com]
- Reduction of VAT Exemption Threshold for Imports
- The VAT exemption for low-value imports via postal traffic or express shipments is reduced from USD 200 to USD 50.
- This impacts e-commerce and international courier services significantly. [kpmg.com], [fedex.com]
Other Related Tax Measures
- Wealth Tax: Threshold lowered to 40,000 UVT (approx. COP 2.09 billion), with progressive rates up to 5%.
- Financial Sector Surtax: Additional 15% income tax, bringing the total rate to 50%.
- Luxury Goods Consumption Tax: 19% on high-end vehicles, yachts, and aircraft.
- Extractive Sector Tax: Temporary 1% tax on hydrocarbons and coal at first sale or export.
- Relief Measures: Reduced penalties and interest for late filings and disputes if settled by mid-2026. [globaltaxnews.ey.com], [rmcsas.com.co], [step.org]
Impact on VAT Compliance
- Increased Complexity: Businesses in liquor, gaming, and e-commerce sectors must update systems to apply new VAT rates and thresholds.
- Cross-Border Operators: Foreign online gaming companies must register and comply with Colombian VAT obligations.
- Logistics Adjustments: Courier companies and importers need to adapt to the lower de minimis threshold for VAT.
- Cash Flow Pressure: Advance payments and higher rates increase financial strain, especially for financial institutions. [kpmg.com], [fedex.com]
Constitutional Review
The Constitutional Court will assess the legality of these measures after the judicial recess ends on 10 January 2026, so some provisions may face challenges.
Colombia adopted emergency tax measures via Decree 1474 to fund the 2026 national budget.
- VAT on liquors, wines, and similar products increased to 19%; 5% allocated to departments.
- VAT at 19% imposed on online games of chance, with the tax base as gross gaming revenue.
- VAT exclusion threshold for express shipments lowered from US$200 to US$50.
- Excise taxes increased on alcoholic beverages and expanded to include tobacco derivatives (e.g., vapes), with departments required to transfer extra revenue to the government.
- No VAT imposed on cloud services.
Source: kpmg.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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