Colombia’s President Ivan Duque said Monday that he would lift sales tax for three days, claiming this would stimulate a recovery of the economy that has been devastated by the coronavirus pandemic.
During his daily Facebook transmission, Duque said he would reopen parts of the retail sector in July and lift sales taxes on both products and rent on June 19, July 3 and July 19.
We have taken the decision, with the Government’s economic team, to provide relief until July 31, the deadline for not charging 19% VAT for leasing commercial premises, measures that should be implemented to give oxygen to the economy.
President Ivan Duque
Tax director Jose Andres Romero, who was invited to Duque’s show, said that “we believe that the reactivation depends on consumer confidence.”
A multitude of economists had already dismissed Duque’s proposal for a three-day sales tax relief before the pandemic, claiming its effects on economic growth would be negligible while severely complicating tax collection.
What may be more significant than the sales tax announcement is that the government apparently wants to lift the current stay at home order and allow the opening of shops exactly when the health minister expects coronavirus infections to peak.
Retail Duque plans to open
- Domestic appliances
- Sports equipment
- Smart phones
- Agricultural supplies
Medical professionals from around the globe have urged restraint in lifting lock downs. According to Dr. Anthony Fauci, the United States’ top infectious disease expert, a rushed lifting of lock down measures could result in uncontrollable outbreaks.
“This will not only result in needless suffering and death, but would actually set us back on our quest to return to normal,” according to the US expert.
Duque’s previous pushes to gradually reactivate the economy have spurred an acceleration of infections, pushing the country’s fragile healthcare system closer to collapse.
Duque and other government officials have made all kinds of announcements on his Facebook transmission that ultimately were either discarded, severely limited or made impossible by lower governments.
In this case, Duque may lift the stay at home order that took force on March 25 and issue a decree allowing the opening of shops, but mayors can make this impossible by issuing curfews and demanding shops to first request verification that they comply with rigid health and hygiene measures.