Economic Emergency Decree No. 1474 of December 29, 2025

In Economic Emergency Decree No. 1474 of December 29, 2025, which was published on the same date, the Colombian Government imposed various taxes to compensate the revenue that was expected to be collected from the Tax Reform Bill, given that the latter was rejected by National Congress
As with all decrees issued under a State of Economic Emergency, its provisions entered into force upon publication in the Official Gazette and are subject to automatic review by the Constitutional Court, which may determine whether a potential declaration of unconstitutionality produces effects prospectively or retroactively.

1. Net Worth Tax – Tax Year 2026
Decree 1474 increases the Net Worth Tax applying as of January 1, 2026. Only in case the Constitutional Court declares the Decree unconstitutional with retroactive effects, the Net Worth Tax for tax year 2026 would apply solely to net assets exceeding 70,000 UVTs.

Under the Emergency Decree, the Net Worth Tax 2026 is assessed on net assets determined pursuant to special valuation rules, including specific provisions for the valuation of shares, which may be reported at their intrinsic value or nominal value, whichever is lower. The tax is levied as follows

UVT for 2026 $52.374; 70.000 UVT equal COP 3.666.180.000 / USD 987.076,55. USD1 = COP 3714.18 at the rate of exchange on 12.01.2026.

2. Complementary Tax on Normalization – Tax Year 2026
Decree 1474 establishes a complementary tax on normalizatio. This Tax is aimed at remedying the omission and undervaluation of assets and the inclusion of non-existent liabilities. This tax applies to assets that were not reported or were undervalued, or to non-existent liabilities, and is due by the person who is entitled to the actual or potential economic benefit of such assets

The basis of the normalization tax is equal to the fiscal cost of the omitted assets or to a commercial self-appraisal determined by the taxpayer with proper technical support, which may not be lower than the fiscal cost. The taxable basis for normalization will be deemed the acquisition price of the assets for future tax cost purposes.

As in prior opportunities, structures created for the purpose of transferring omitted assets to entities with tax costs substantially lower than those of the underlying assets, will not be recognized.
For purposes of this tax, foreign private interest foundations, foreign trusts, insurance products with a material savings component, investment funds and any other foreign fiduciary arrangement are treated as fiduciary rights held in Colombia and are subject to the principle of tax transparency with respect to the valuation of underlying assets. Where beneficiaries are subject to conditions or lack control or disposal rights over the assets, the person obliged to file the tax declaration shall be the founder, settlor or originator of the assets, and in the event of death, the undivided estate, until such time as the beneficiaries effectively receive the assets.

The tax rate applicable to the complementary tax on normalization is 19%. The complementary tax on normalization must be reported, assessed and paid by filing a separate tax return no later than July 31, 2026. The Decree excludes all possibilities of late filing or subsequent amendment.

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