Colombia's Fiscal Reform Challenges

BOGOTA (Reuters) – Colombia's Interior Minister Juan Fernando Cristo stated on Monday that the government's proposed 12 trillion peso ($2.73 billion) fiscal reform was "not viable," but suggested that a smaller sum could be feasible.

The government introduced its latest fiscal reform to Congress in September, aiming to finance spending in 2025 through tax increases and additional debt.

Cristo remarked, "I believe, to be completely frank and sincere, that today it's not viable to consider a financing law that raises the 12 trillion needed for the budget, but it's possible to advance in several points of the reform that give a lower figure," during a press conference in Bogota.

In late November, the government announced it would reduce spending this year by 28.4 trillion pesos, due to lower-than-expected tax revenues.

The Autonomous Fiscal Rule Committee indicated last month that the 2024 budget requires a 56.2 trillion peso cut to adhere to the fiscal rule established in 2011, which aims to prevent the deterioration of public finances.

> Note: ($1 = 4,396.52 Colombian pesos)