Last month, Colombia’s Finance Minister, Mauricio Cardenas, officially announced the country’s impending e-invoice mandates in an interview with El Tiempo. Using regional neighbors Chile and Mexico as models, Colombia DIAN is tackling tax evasion and reducing government expenditures through a three-pronged approach that focuses on the implementation of e-invoicing, tighter scrutiny of tax-exempt nonprofit organizations and strict controls on public spending.
It’s estimated that tax evasions cost Colombia 10 billion pesos each year, and Cardenas cites electronic invoicing as the most innovative way to prevent tax evasion. Smuggling, and the resulting tax evasion, “destroys the entrepreneurial base of Colombia” he told El Tiempo. The anticipated economic impact of these new regulations is 4 billion pesos in additional tax revenues and 4 billion pesos in public spending savings.
By clamping down on evasion, Colombia aims to enhance its current economic momentum and ward of the effects of falling oil prices. Colombia is currently the fastest growing economy in the region, growing at 2.8% in the first quarter of 2015, with anticipated growth this year at 3.6% (compared to the 0.9% International Monetary Fund projection for the region as a whole). In fact, Colombia is expected to join the Organization for Economic Co-operation and Development (OECD) in 2016, an international economic organization of 34 countries with strict admission guidelines. The OECD was founded in 1961 to stimulate economic progress and world trade.
Anticipated for some time now, the e-invoicing announcement means companies operating in Colombia need to step up their preparations for enforcement. As details of Colombia’s new requirements continue to emerge, view our Colombia Mandates for E-invoicing webinar to learn how your operations will be affected by these new mandates and what you need to do to prepare.