COLOMBIA · COFFEE TAX
Key Facts
- The bill A rescue bill filed Thursday 29 October 2026 would raise sales tax on coffee to 19%.
- The tax today Green coffee beans, the export crop, are excluded from sales tax; roasted coffee pays 5%.
- The warning Coffee exporters’ association Asoexport says up to US$708 million could be tied up until refunds arrive.
- Why the US cares The United States took 43.3% of Colombia’s coffee export volume in September 2026.
- Where it stands Congress must approve the bill, and its regular session ends 16 December; nothing is law yet.
- Power Index Colombia ranks 6th of 14 in The Rio Times Latin America Power Index, with 51.1 points (November 2026 edition).
Colombia’s government wants a 19% sales tax on coffee, and exporters warn the Colombia coffee tax could tie up US$700 million. Colombia is the world’s third-largest coffee producer, and the United States is its biggest buyer.
The money would be fronted, not lost, because exporters would pay the tax on domestic purchases and then wait for the state to refund it. The bill was filed on Thursday 29 October 2026 and still needs approval from Congress.
What the Colombia Coffee Tax Would Change
President Abelardo de la Espriella’s government filed the Economic Rescue Law, known as Bill 477, on Thursday 29 October 2026. Finance Minister Miguel Gómez Martínez and Vice President José Manuel Restrepo presented it as a plan to cut spending and raise revenue.
The bill would scrap the special 5% rate of the value-added tax, called IVA, which works like a sales tax. From January 2028, goods on that rate, including coffee, salt, sugar and cooking oil, would move to the standard 19%.
Today green coffee beans are excluded from IVA, and roasted coffee and coffee extracts pay the special 5% rate, according to exporters. The bill would put both at 19%, as laid out in our explainer on the rescue law’s five points.
Why Exporters Say Cash Would Get Stuck
Colombia exports more than 90% of its coffee, and exports stay free of the tax, according to Asoexport. That means exporters would pay 19% on beans bought at home and then wait for a refund or credit from the state.
Asoexport, Colombia’s national association of coffee exporters, estimates that up to US$708 million could be tied up in this way. It says the cost would fall on the working capital exporters use to buy beans from farmers.
The Colombian Coffee Growers Federation (FNC), the national growers’ body, counts US$3.56 billion in preliminary export value for January to September 2026. At 19%, that is about US$676 million, close to Asoexport’s estimate of up to US$708 million.
A Sector Already Under Pressure
Exporters are already squeezed, with the FNC counting 8.46 million 60-kilogram bags shipped from January to September 2026, down 13.7% from a year earlier. Estimated export value fell 4.7% over the same period.
Asoexport says a stronger peso is cutting what exporters earn in local money for each dollar they sell. A new cash burden would land on top of that, in a sector that supports more than 550,000 coffee-growing families, according to the association.
FNC general manager Germán Bahamón wrote on Friday 30 October 2026 that a rise from 5% to 19% could shrink demand. He warned that shoppers could switch to cheaper imported coffee, which would hurt Colombian processors.
What Exporters and Growers Are Asking For
Asoexport wants green coffee and the fique sacks used to ship it to stay excluded from the tax. Failing that, it asks for a fast refund system so exporters do not run short of cash.
The association says it is ready to join the debate in Congress and wants an assessment of whether the measure works in practice. It also warns that small farmers in remote areas would need tax training to handle new filing steps.
Congress has little time, because the regular session ends on 16 December and a bill needs four debates. The wider fight over the package is covered in our report on the US$13 billion rescue law facing Congress.
In Plain English, Who Is Who
Asoexport is Colombia’s national association of coffee exporters, led by executive president Gustavo Gómez. The FNC, the Colombian Coffee Growers Federation, represents the country’s coffee farmers and is led by Germán Bahamón.
IVA is Colombia’s value-added tax, a sales tax collected at each step from producer to shop. Exports sit outside it, so exporters must claim back the IVA they paid on what they bought at home.
The Economic Rescue Law is the government’s package of spending cuts and tax changes. It also changes how fuels are taxed, as we reported in our story on the gasoline tax plan.
What It Means for You
The United States took 43.3% of Colombian coffee exports by volume in September 2026, with 510,983 bags, according to the FNC. US importers, roasters and cafés that buy Colombian beans are the buyers most exposed if costs rise.
Nothing in the bill sets a price for US shoppers, and the new rate would not start before 2028. Buyers should watch whether Congress keeps green coffee excluded, because that decides how much cash exporters must front.
What Is Not Known
The start date for taxing green coffee has not been stated, and the government has not said how fast refunds would be paid. Congress may also change or drop the coffee measure during the four debates.
It is not known whether exporters would absorb the cost or pass it on to buyers abroad. Recent coffee supply data are in our report on Colombia’s coffee harvest falling 15%.
More: Latin America news in English, every day from The Rio Times.
Frequently Asked Questions
Does coffee carry sales tax in Colombia today?
Green coffee beans are excluded from the tax, and roasted coffee pays a special 5% rate, according to exporters. The rescue bill would move both to the standard 19%.
When would the new coffee tax start?
The government’s outline moves goods from the 5% rate to 19% from January 2028. The bill must first pass Congress, and no date has been given for green coffee.
Why would exporters have to front US$708 million?
Exports are free of the tax, so exporters would pay 19% on domestic purchases and wait for a refund. Asoexport estimates up to US$708 million could be tied up in the meantime.
Would the tax raise coffee prices in the United States?
Nothing in the bill sets US prices. The effect would depend on whether exporters absorb the cash cost or pass it on to buyers.
Sources: Colombian Congress, Bill 477 of 2026 (Ley de Rescate Económico), filed by the Ministry of Finance, 29 October 2026; Colombian Coffee Growers Federation, monthly export report for September 2026, October 2026; Colombian Coffee Growers Federation, statement by general manager Germán Bahamón, 30 October 2026; Asoexport (Colombian coffee exporters association), position on the rescue bill, 5 November 2026.
Editorial responsibility: Matthias Camenzind, Editor-in-Chief · Editorial standards · Report an error