Colombia Shelves Digital Payments Tax Plan After Backlash

Colombia’s finance ministry is shelving a proposal to impose a withholding tax on digital payments, following a backlash from industry groups and businesses.

Instead, the government will issue a decree to eliminate the tax on credit and debit card payments, thereby ensuring a level playing field for different payment methods, Finance Minister Germán Ávila said.

Last month, the ministry had proposed requiring companies to withhold 1.5% on payments received via digital wallets or platforms such as Bre-B, the central bank’s new payment infrastructure.

“This reinforces the incentive for the use of digital and electronic means, seeking greater transparency in transactions ...