The national government presented a bill to establish limits on the payment of property tax to reduce the impact of updating the multipurpose cadastre – Infobae credit.
A wave of criticism was generated by the national government’s bill that seeks to gradually establish limits for the payment of the Unified Property Tax (IPU) because it was initially implied that it meant an increase in that tax.
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However, although the initiative establishes increases in the payment of the tax of between 50% and 300% in relation to what was paid the previous year, what the national government actually seeks is to avoid payments exceeding these limits, given that With the current standard they can reach more than 1,000%.
The bill, presented by the Minister of Finance, Ricardo Bonilla, and the Minister of Agriculture, Jhenifer Mojica, seeks to modify four articles of Laws 44 of 1990 and 1995 of 2019.
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Law 44 establishes an annual adjustment to the value of cadastral appraisals that cannot be higher than 100% of the CPI. For its part, Law 1995 establishes that the property limit will be CPI+8 for properties that have been updated, regardless of the cadastre.
Now, the Government’s initiative proposes a cap limit with reference to the previous year. This is how Henry Amorocho, professor of Public Finance at the Universidad del Rosario, explained it to Infobae Colombia: “A scheme of gradual limits is established that basically starts from properties with less than 135 minimum wages, where a maximum of 100% of what you paid in the previous year, in the event that the cadastral valuation is being updated.”
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That Government initiative corresponds to its National Development Plan for the period 2023-2027, which seeks to update the multipurpose cadastre by at least 70% between now and 2026. Currently, the cadastre is around 9 .6%.
To achieve this, the Government must physically, legally and economically update 80 million hectares distributed in 600 municipalities throughout the national territory.
Rural areas are where there is the greatest delay in updating the cadastre in Colombia – Colprensa credit
Updating the cadastre is of utmost importance so that the State can exercise adequate control over the ownership and uses of rural or urban land for its effective taxation. This is an inventory of the country’s land that includes the rights, restrictions and responsibilities over it.
However, the issue has been almost ignored in Colombia, to the point that less than 10% of the cadastre is updated to date. In the middle of the process, the IPU could skyrocket, especially on properties where a cadastral appraisal has never been carried out or where it has not been carried out for decades. Therefore, the Government hopes to be able to reduce this effect with its bill.
Adrian Garlati, director of the Economics program at the Javeriana University, explained to Infobae that the rule would only apply to land valued under new cadastres.
“In places like Bogotá, Medellín, Cali, that is, in the cities, the cadastral appraisal is usually updated, so in reality in those cases this regulation would not apply. We should be concerned about places where the cadastre is outdated and they are going to update it,” said the economist.
In cities like Bogotá, Medellín or Cali, the cadastral appraisal is usually updated – credit Colprensa.
Regarding the fear that the bill could mean an excessive increase in the IPU, Professor Amorocho stated that the Government of Gustavo Petro must “establish better communication with the Congress of the Republic and have more work to socialize its projects. law, because undoubtedly in the country there is no tax culture and in that sense a lot of information is being given that does not correspond.”
He added that: “Truly, what is being established is simply gradual limits on a tax base that will increase because it goes from a lagging cadastral appraisal to a cadastral appraisal that will coincide with the commercial appraisal.”