Colombia · Law · Legislation

Law adopting a Tax Reform for Equality and Social Justice (Law No. 2277 of 2022)

Objectives:

This law reforms the country's tax structure to promote equality and social justice, and adopts a tax on ultra-processed foods and ultra-processed sugary beverages

Scope:

This law reforms the Colombian tax system to promote equality and social justice. For the purposes of FULL, the most relevant part is the adoption of healthy taxes (“impuestos saludables”) on ultra-processed foods and ultra-processed sugary beverages.

The products subject to a tax are ultra-processed edible products with added sugars, salt/sodium and/or fats that exceed specific thresholds (in Spanish, the exact definition is “productos comestibles ultraprocesados industrialmente y/o con alto contenido de azúcares añadidos, sodio o grasas saturadas”). The tax rate is a fixed percentage to be implemented progressively throughout 3 years. Starting in 2o23, the tax rate is set at 10%, increasing to 15% in 2024 and to 20% in 2025 (Art. 513-6).

A second category of products subject to a tax are ultra-processed sugary beverages, as well as concentrates, powders and syrups to obtain them (in Spanish, the exact definition is “(“bebidas ultraprocesadas azucaradas así como los concentrados, polvos y jarabes que, después de su mezcla o dilución permiten la obtención de bebidas azucaradas”). Beverages with a volumetric content of alcohol exceeding 0,5% vol are excluded from the application even if they contain added sugars. These products are subject to a health tax when they exceed 6g of added sugars / 100 ml. The tax rate is a fixed amount of Colombian pesos tiered according to the sugar content. The health tax is applicable starting November 2023 and increasing progressively throughout the following 3 years, until full implementation in 2025 (Art. 513-1).

The law has been challenged in court. In 2023, the State Council upheld it (see related documents).