TAX REGIME FOR MEGA INVESTMENTS AND STABILITY CONTRACTS
Mega Investments and Stability Contracts
Taxpayers that make Mega Investments in Colombia will have an income tax rate of 27%, and other tax benefits. To ensure this regime for a period of 20 years, taxpayers may enter into tax stability contracts with the Colombian Government
Taxpayers that make an investment in the country equal or greater than 50 million Tax Value Units (COP1,657,800,000,000 – Approx. USD526,285,700), in any sector of the economy (other than non-renewable resources and infrastructure projects under any contracting scheme, and projects regarding the construction and/or operation of Free Trade Zones), and generate at least 50 direct jobs, may benefit from a reduced income tax rate of 27%.
Additionally, taxpayers that make the Mega Investment would: (i) be entitled to depreciate its fixed assets in a minimum period of two years; (ii) not be subject to the minimum presumptive tax system (renta presuntiva); and (iii) not be subject to the dividend tax.
Additionally, taxpayers may enter into tax stability contracts with the Colombian Tax Authority, in order to ensure these benefits for 20 years, once the Ministry of Commerce, Industry and Tourism qualifies the project as a Mega Investment.