The government hopes to raise 15.2 trillion pesos (just under $ 4 billion) through the rule that was approved by Congress last week.
Duque congratulated himself for carrying out the “most important reform” in Colombia so far this century in consensus, he said, with the political forces and powerful economic unions.
The law establishes monetary aid that will benefit 14 of the 50 million Colombians and free university tuition for poor and middle-class youth.
In addition, it approves subsidies to the payroll of small and medium-sized companies punished by the pandemic and by the protests against the previous tax bill.
Faced with the increase in poverty to 42% and unemployment (16%) last year in Colombia, Duque tried to finance social protection programs with taxes that punished the middle class, already hurt by the closure of activities that imposed the health and economic crisis by Covid-19.
Social anger took over the streets. Since April 28, hundreds of thousands of people have protested daily for more than a month. The police repression fueled discontent that resulted in at least 60 deaths, according to the Ombudsman, and prompted a wake-up call from the Inter-American Commission on Human Rights (IACHR) for the excesses of the public force.
The government was forced to withdraw its unpopular proposal and to leave the then Minister of Finance, Alberto Carrasquilla.
The new reform falls on the wealthiest and, incidentally, seeks to stabilize public finances affected by the recession that caused the health crisis.
The current head of the Treasury, José Manuel Restrepo, considered that the new tax framework is “appropriate” for the social context.
“It generates resources, maintains the principle of not affecting the middle classes, vulnerable and pensioners,” he said in an interview with the Valora Analitik portal.
In addition to the economic damage, the pandemic has left 125,687 dead since March 2020 in Colombia.
This year the government launched a massive vaccination campaign that has significantly reduced deaths and daily infections, and which to date covers 31% of the population with two doses.