Colombia’s Constitutional Court Upholds Tax Hike on Energy Mining Sector
Colombia’s Constitutional Court has confirmed the implementation of a corporate income tax surcharge for the energy mining sector as part of the 2022 tax reform. This surcharge will apply to companies involved in oil, gas, and coal extraction.
The Court’s ruling establishes thresholds for coal and oil companies based on international prices. Companies will face adjusted income tax surcharges depending on the fluctuation of prices, with different thresholds for each commodity.
President Gustavo Petro welcomed the decision, emphasizing the importance of using fossil fuel revenues for decarbonization efforts and societal changes. While some business leaders and experts are concerned about the impact on foreign investment, the government views the surcharge as a necessary step towards a more sustainable economic model.
This ruling signifies a significant shift in Colombia’s energy sector taxation, aligning revenue generation with environmental goals. The long-term effects on the economy and industry are yet to be determined.