September 18, 2018
Economy News

New laws cost Colombia 3.2 billion pesos per year

There is more evidence today that smaller government provides better services at a lower cost in Colombia. According to the Medium-Term Fiscal Framework (MFMP), presented by the Minister of Finance of Colombia, the approval of new laws is negatively impacting the public budget.

The document, which analyzes public revenue and expenses from the prior year, show that 51 new laws were approved since 2016, but those laws increased expenses by 482% in the national budget.

This excessive cost might be related with the Congress’ increasing approval time for new initiatives as well as with the negotiations of peace in Colombia. Expenses are predicted to triple in the coming year.

The Minister of Finance has exhorted Colombian Congress to review the impact of any new laws upon the budget while considering their passage. There is even more concern about recurring expenses, which make up 2.8 billion pesos, or US $923 million dollars.

Not surprisingly, of the 51 new laws approved in 2016, one of the most expensive is the law that establishes the end of the conflict with the FARC terrorist group.

Tax revenue is expected to dramatically increase in 2017 after the congress increased the IVA (VAT) tax from 16% to 19%.

 

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