Colombia’s Introduction of Tax Arbitration a ‘Big Advance’

Colombia will seek to allow arbitration in tax disputes for the first time in a major step forward, although questions remain about the proposal’s efficacy, tax professionals say.

Under the bill sent to parliament this week for consideration, disputes between payers and the tax authority could be handled by arbitration, which would help ease congestion of the courts system, the Finance Ministry said.

“It would be a big advance for the country and payers to have this alternative dispute resolution tool for conflicts with the DIAN,” Juan David Velasco, tax partner at Baker & McKenzie, said.