Colombia Plans Emergency Tax on 15,000 Firms for Floods

Floodwaters are still rising across northwestern Colombia, and the Petro government is reaching for the same emergency lever that courts have already blocked once — only this time the crisis is measured in drowned cattle, not spreadsheets. This is part of The Rio Times’ daily coverage of Colombia affairs and Latin American financial news.

Speaking from a cabinet meeting in Montería, at the heart of the disaster zone, Finance Minister Germán Ávila unveiled the plan: a progressive wealth tax exclusively on corporations.

Companies with net assets above 200,000 UVT — roughly COP 10.4 billion — would face a 0.6% levy, rising to 1.2% for those above COP 31.4 billion. The tax would hit about 15,000 firms and raise COP 8 trillion for disaster recovery.

The urgency is real. Atypical rains since early February have killed at least 22 people, displaced some 69,000 families, and submerged over 40,000 hectares of farmland across a department central to Colombia‘s cattle industry. Córdoba’s governor called the flooding unprecedented, with 80% of the territory affected.

Emergency Powers Clash With Business Opposition

The political backdrop makes the fiscal response more contentious than the humanitarian one. This would be Petro‘s fourth state of exception, arriving days after the Constitutional Court suspended the December emergency decree that sought to close a COP 16.3 trillion gap.

Ávila blamed legislators for deepening a crisis he says the administration inherited through pandemic-era debt and fuel subsidy imbalances.

The private sector pushed back hard. ANDI president Bruce Mac Master called it a tax on investment that would discourage firms from keeping capital in Colombia.

Anif president José Ignacio López questioned the logic of answering a weather emergency with a wealth levy. Tax experts flagged double taxation risks, since shareholders already pay personal wealth taxes on their equity stakes.

For the government, the arithmetic is blunt: Córdoba needs money, the court froze the previous tax package, and Congress will not cooperate.

For the business community, it is another improvised extraction in a country where the tax burden has risen sharply since 2022. The Constitutional Court now faces a second emergency layered on the first — testing how far executive power can stretch when disaster and deficit collide.

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