15 April 2020 – Public officials to adopt Solidarity Tax, cutting salaries for next 3 months

Type of Intervention: Executive Order, Financial and Economic, Specific Action
Sectors Involved: Finance/Economy
Level of Jurisdiction: National
Lead People/Agency: Decision made By: President and Cabinet of Ministers.

The administration and collection of solidarity tax by COVID 19 will be from the Administrative Unit Directorate of Taxes and National Customs DIAN and will be transferred to the Emergency Mitigation Fund -FOME

Overview: The National Government issued Decree 568, which created the Solidarity Tax for the coronavirus pandemic (COVID-19), within the State of Economic and Ecological Emergency.

This is a three-month tax, which is mandatory for all people who work in the public sector and establishes that officials who earn between $ 10 million and $ 12.5 million ($COP) must contribute 15% of their salary, while officials with Salaries between $ 12.5 million and $ 15 million ($COP) will have to contribute 16%. Meanwhile, salaries that are in the range of $ 15 million and $ 20 million ($COP) will apply a rate of 17%, and those above $ 20 million ($COP), one of 20%.

From May 1 to July 31, 2020, the Solidarity Tax for the COVID-19 is created, with a specific destination for social investment in the most vulnerable middle class and in informal workers.

What this transitory tax seeks is that there be solidarity to serve the most vulnerable families.
Full details here: https://coronaviruscolombia.gov.co/Covid19/docs/decretos/minhacienda/236_DECRETO_568_2020.pdf

Type of Justification: Advice of INTERNAL government advisory committee or group
Source of Evidence or Justification: National – government
Evidence/Justification: That despite the measures adopted, the Ministry of Health and Social Protection reported on April 13, 2020, 112 deaths and 2,852 confirmed cases in Colombia.

In accordance with the economic considerations of Decree 417 of March 17, 2020, it is evident that the Colombian health system is not physically prepared to attend a health emergency, it needs to be strengthened immediately to attend a surprise event of the magnitudes that the pandemic has reached.

The projection of costs of health care, with a contagion rate of 2.68, is estimated at $ 4,631 .085,235,141 Colombian pesos ($ COP), the cost of disabilities is estimated at $ 94,800,716,459 ($ COP), the cost of investment in intensive care units would be $ 200,000,000,000 ($ COP), the cost of expansion of the isolation area through the provision of hotel capacity would be $ 36,000,000,000 ($ COP), for a total of resources in this scenario of $ 4,961,885,951 .600 ($ COP).

The effects derived from the circumstances that motivated the declaration of the State of Economic, Social and Ecological Emergency affect the right to the minimum vital of the most vulnerable households, as well as of the middle class and informal workers, for which it is necessary to adopt Exceptional measures to provide financial support to the vulnerable middle class and informal workers, considering that the most vulnerable households have been financially supported by the national government.