Colombia to End VAT Exemption for Cross-Border E-Commerce

Key Policy Change

Under current law (Article 428 of the Tax Code), imported goods valued under $200 USD sent via postal or express delivery are exempt from Value Added Tax (VAT/IVA).

The Colombian government plans to eliminate this exemption. In the future, purchases from international platforms such as Amazon, AliExpress, TEMU, and SHEIN will be subject to a 19% VAT, regardless of the order value.

Reasons for the Reform

• Market Maturity: Finance Minister Germán Ávila stated that while the exemption was originally meant to encourage e-commerce growth, these platforms are now well-established.
• Revenue & Fairness: The goal is to expand the tax base and increase national fiscal revenue.
• Global Trend: The government noted that many other countries are implementing similar measures (citing recent U.S. executive actions on de minimis tax rules).

Current Status

The exact effective date has not been specified yet, but the proposal is part of a broader tax reform intended to normalize tax regulations for digital commerce.

***Photo Reference: https://www.mofa.gov.tw/CountryInfo.aspx?CASN=6&n=166&sms=33&s=18***