🧐 ProPicks AI October update is out now! See which stocks made the listPick Stocks with AI

Lawmakers reject Colombia government's 2025 budget proposal

Published 09/11/2024, 05:18 PM
Updated 09/11/2024, 05:43 PM
© Reuters. FILE PHOTO: Members of Colombia's congress attend the opening of the new session in Bogota, Colombia July 20, 2024. REUTERS/Nathalia Angarita/File Photo
USD/COP
-

By Nelson Bocanegra and Carlos Vargas

BOGOTA (Reuters) -The Colombian Senate's economics committee threw out the government's proposed 2025 budget on Wednesday, arguing the Andean country will not be able to raise the proposed sum amid lower-than-projected tax collection.

At the end of July, Colombia's finance ministry presented a proposed budget to Congress for next year worth 523 trillion pesos ($122 billion).

The budget was rejected even after the finance ministry on Tuesday presented a new fiscal reform proposal to lawmakers to raise some additional 12 trillion pesos ($2.8 billion), which the government says would finance the budget.

But the majority of lawmakers sitting on economic commissions in both the Senate and the lower house, who were weighing the bill jointly on Wednesday, said government efforts to raise more funds, including plans to tackle evasion and avoidance, are not realistic.

"We cannot approve an unfinanced proposal, the product of the irresponsibility of President (Gustavo) Petro," said Senator Carlos Abraham Jimenez, of the right-leaning Radical Change party.

Petro on Tuesday said he would set the budget by decree if Congress rejected it.

"The country needs seriousness, justification and certain sources when it comes to approving budgets with values like the one presented today, if it's not like that we have to reject," said Senate president Efrain Cepada, of the Conservative party. "This isn't personal, it's the minimum demanded in congress."

The Senate's economic commission rejected the budget's value by 12 votes to one, after which a vote by the house committee was not needed.

Last June, the finance ministry was forced to freeze some $4.6 billion in spending because of a drastic fall in tax income, leading to an increase in the fiscal deficit target for 2024 to 5.6%, from a previous 5.3%.

© Reuters. FILE PHOTO: Members of Colombia's congress attend the opening of the new session in Bogota, Colombia July 20, 2024. REUTERS/Nathalia Angarita/File Photo

An independent committee which oversees the country's compliance with its so-called fiscal rule - designed to stop public finances deteriorating - in July said that adjustments were needed to ensure compliance in 2024 and 2025, due to possible risks to tax collection.

($1 = 4,285.61 Colombian pesos)

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.