A esto se debe la rabia contra la REFORMA TRIBUTARIA | La Pulla - YouTube

People are pissed off and confused by the tax reform

and for a good reason

because the government not only presented a hefty, hard to understand, document, and

has not even tried to explain it,

but they think we are idiots.

Way before the presentation of the final text they had been doing emotional

terrorist campaign that we are going to tell you:

“When your family needed you, you were supportive. When the neighbor went to you,

you were supportive. When your friend asked for help, you were supportive. Today your country

also needs your support.”

Also, Duque, the president, insisted that it wasn’t a tax reform, but a Solidarity

Law

And listen to him defending it:

“This sustainable social transformation is urgent!”

Are we surprised?

No, we are not.

He had made it before with other two different tax reforms which he called with the euphemism:

Financial Law and Growth Law.

Oh, kiddo, at the Sergio Arboleda University they may validate this trick for an essay,

but you can’t play like that with us.

In addition, for months the government had been testing the waters by dropping

outrageous proposals.

Like the coffee’s VAT:

“We all can pay a little bit more VAT for coffee and is not going

to affect our incomes or life standards”

So that Duque could come as a savior to say that the idea wasn’t rational

Listen to him:

“I have said: food products of the colombians market basket, will not be

subject to the 19% VAT. No VAT will be applied.”

You don’t say! The hero that Colombia needs.

And to complete this pissed off dish, the minister, Alberto Carrasquilla, the Finance Minister, made

this wonderful act:

“Let’s say that eggs are 0.488 USD a dozen or something close to that.”

Don’t even try to ask the minister how much the ticket for the bus costs or he will answer

0.35 USD

Because of all of this and because the the tax reform is not easy to understand the reaction is, nonetheless, indignation

we also feel overwhelmed

But instead of talking with Thomas and Jéronimo Uribe,

We sat down with experts to help us untangle our thoughts.

Or that’s what we believe

What we could conclude is that there are bad things, but also we were surprised that not everything was ruined.

Let’s untangle this mess together.

Why did they thought about a tax reform in the middle of a global pandemic where most

of us are fucked up?

What happens is that the government's finances are also fucked up.

For many reasons:

First: We’ve been holding a 2.6 trillion USD fiscal whole that was created by Duque

and Carrasquilla to give some presents and exemptions to the wealthy people in

the last tax reforms.

Second: Because of the pandemic, it is estimated that the government invest 11.9 trillion USD

on the 2020 just to improve hospitals capacity

to attend to the most vulnerable,

protect employment and revive the economy.

However, he did it by halves and with tons of criticism,

If you want, you can watch the video we made about the subject,

It was a lot of money spent.

Third: because of the economic crisis, the country collected less taxes

that they were counting with before the pandemic.

Of the 42.5 trillion USD that were supposed to be collected, the actual income was

only 34.4 million USD.

So we had to spend money that we didn’t have.

That bring us to:

Fourth: the government had to look for money and went into debt.

That is why they asked for loans

and the percentage of the country’s debt exceeds 60% of GNP.

The biggest on the last 9 years

Fifth: we have the highest fiscal deficit in the last 70 years.

This means that we are spending more than we have

And we don’t need an economy Nobel to know that if we spend more than what we have

We are in serious problems

Sixth, the most hurtful and important one:

We are at risk of almost half of the population becoming poor

People got no jobs, less income and are going through hard times

So yes, it’s shitty that we need a tax reform in the middle of a crisis

because when we look into our wallets there is no money, besides many people

already lost their jobs, they are suffering and are tired.

But it is because of this hell of a crisis in which we are right now that we need a tax

reform

Ok, we do need a reform, but you couldn’t care less

because it is going harm the poor population

The poor have to pay while the wealthy enjoy

It is true that the government wants more people to state their income and pay more taxes.

And since the matter is unclear and there have been rumors spreading, people don’t know who is going to pay

and what is it that they will pay.

It is estimated that by 2022 people with monthly income superior to 862 USD

will have to state it.

But by 2023, those with an income superior to 620 USD will have to do it.

The thing is, it won’t fall on the most vulnerable people.

In this screwed up country, poor people earn less than 170 USD per month.

And keep in mind, people with that income represent 67 % of the population.

Over half the people in the country.

Yes, you heard that right.

Over half the people in the country earn less than 170 USD per month.

Today, these people don’t state nor pay income taxes.

And the bare minimum is that they not be affected, like they evidently won’t be, by this overhaul.

On the contrary, all experts say there is a good bet on the project

taking down poverty through the Solidary Income program.

It aims to reach 18,8 million people.

Picture this, in 2019, when the Solidary Income program didn’t exist,

there were other transactions reaching 9,7 million people.

This new deal bets for THE DOUBLE.

This could bring great benefits:

It would reduce inequality at a much faster rate than we have been working on,

And it would increase the resources of the poorest people.

Actually, it is estimated that 10% of the population with the lowest income in the country

will have more money assured to get by, which in itself moves and reactivates the local economy.

Moreover, the income adds up to all the other supplementary aid that the government already provides

to the poorest people.

This reform is so ambitious and unexpected coming from Duque’s government,

that several far right wing intellectuals are upset about it.

Duque and Carrasquilla: the all of a sudden Commies.

Well, great!, awesome!, wonderfull! Sign me up!

So, yes, picture-perfect, but we must continue alert

Because one of the biggest challenges is to achieve a surveillance that ensures

that the money gets to those who need it.

An example of this challenge is the ‘Familias en Acción’ case, in which they found out that,

by 2018, 34 % of the households benefited by it weren’t in poverty.

This is a big problem, because the goal for doing all of this is that the budget

goes to the people who need it.

Which is why we should be careful. After all, we know this country’s

national sports are:

Tejo, corruption, and useless bureaucracy.

But what caught our attention the most was this:

With this tax reform, someone in an economic crisis, with no money at all

will at least have a bed to survive in with dignity.

Thank you very much Duque and Carrasquilla. Really.

Should I set up an altar?

Oh, our saviors.

Since when are you so altruistic?

Next you’re going to tell me this reform won’t wrong nobody.

No, no, no, no, no. Wait! This will actually affect many people.

6.3 trillion USD will be collected through the overhaul, and it won’t come out of nowhere.

Let’s talk about the middle class.

The middle class?

What is that?

Those in the middle of the economic pyramid, dumbass.

Kidding, just kidding.

When they say the fiscal reform will make middle class people pay the taxes, they’re not wrong.

From 2023 on, those with an income higher to 620 USD will have to pay for that tax.

And those paying it nowadays, are earning over 1.267 USD.

Whether this is good or bad it is still on debate.

Some experts said this could affect at a large scale the middle class because they’re the ones

who’ve endured unemployment and informal jobs the most.

However, other scholars say that if only the richest people pay

it won’t be enough to cover the overhaul

and that more people should contribute to it.

In other words, even if it’s a little bit, you should pay or at least state taxes.

That’s what they say.

The things is, the government is asking a barely surviving middle class to contribute,

while rich people can keep calm because it won’t affect them as much.

Faced with such injustice, it is natural that people get outraged.

And the anger doesn’t come from just that.

What about the VAT?

It goes up and down, up and down again.

The VAT isn’t as cool, easy and popular as one of our artist’s songs.

Before they announced the reform, everyone was afraid that the food basket

was going to be subject to VAT.

On some days, the government would announce that it would apply to coffee, salt, chocolate and sugar

The next day the President would take it back.

In the end, the government didn’t assign a VAT for the food basket,

And was hoping that after such generous consideration, people would keep quiet.

But, be careful! Because product prices could go through the roof, even without the VAT

and you could end up paying more for goods such as meat, chicken, fish, milk,

eggs, rice, vegetables, tampons and pads.

No, no, no, no, no. But I don’t get it, if no VAT was charged,

So then, why could you end up paying more?

Through this example, see how it works:

Imagine you need two pounds of pork

so you go to the butcher’s shop and buy it.

But that pork had to be fatten up on a farm, with food that had to be paid by the farmer

who paid VAT.

Nowadays, the farmer can claim to the government

“Hey, I had to pay VAT to maintain the pig. Please, give it back”.

And the government gives that money back.

So that price for the production of the pork is lower and, thereby, what you would be paying for

that pork would also be lower.

Now, with this overhaul, the government won’t have to give the money back to the farmer.

And that piece of meat is going to cost you more

For this and many other reasons, we have to stop eating meat or at least lower its consumption.

But, well, that will be a discussion for another episode.

But back to the topic, the ones that are most affected with these changes are

Yes, you guessed it, the middle class.

Because the government returns the VAT to the most vulnerable population of the country.

And the rich ones are not affected by price increases.

While the middle class stay in the middle, without help, paying more, with the same incomes

And what’s more, paying taxes.

But talking about the middle class and the ones who've always been wronged...

What happens with the richest people?

Are they ever touched, or what?

Well, touched, touched, touched, to the point of getting “intimate”

No.

If one looks closely at where the richest people’s money is coming from, finds out that

their money comes from elsewhere and not only by working eight hours in an office:

So, they have properties that yield them. They have shares in enterprises that pay them dividends

And here is when one starts realizing that, for it to be a “solidary” reform,

It requests very little solidarity from the truly rich ones.

A Committee of Experts told to the government that the richest have too many tax

benefits.

And there was hope that this reform would correct this.

But, no.

Sources explained to us, with specific cases, why that didn't improve.

For instance, they told us that in the wealth tax would be recommended not

only that those with a 1.3 million USD wealth pay taxes

But also, the ones with a 808 thousand USD wealth onwards, pay them too.

And in this way the number of rich who paid would be increased.

We would pass from 7.000 taxpayers to 39.676.

We would get some 32.000 more people to chip in!

Magnificent.

And... it wasn’t done.

Another example is the tax to the dividends, that are earnings from shares that are held

in an enterprise.

The critique to this is that the reform removes the taxes from people who earn from

2.6 million USD up for its dividends.

And only those who receive 7.6 million USD would be paying taxes.

This is serious because the State stops receiving money that it used to receive.

Another weakness are tax havens

And this reform doesn’t make the slightest effort to put them at bay.

Let’s see: some rich invest their money in places where they are not charged for having it

And in this way they avoid the taxes that they would put in the country.

Indeed, at least 80.8USD would be in tax havens without

paying anything

And with them could be collected 4.8 trillion USD, if they were in the country

Attention! boys and girls: 4.8 trillion USD of the 6.3 trillion USD that this reform

seeks to collect

In brief, the government is so cute! playing the “statues”

That means: standing still by the rich.

So, we knew how to have more money and make the richest people pay and

it wasn’t done.

Well, we knew it, the issue with the rich isn’t a surprise,

But tell me, which other “pearls” has hidden this reform?

Duque made a fine pearl necklace with the exemptions.

Take a look:

One of the great recommendations that the Committee of Experts made to the president

was to dismantle the tax benefits that some sectors in the country have.

Duque did remove many, but he left others that are not justified.

First pearl:

Colombia is the second country in Latin America with the most free trade zones

and Duque wants us to continue fighting for the championship.

That’s why he didn’t touch them.

These places have several tax benefits, including that they do not pay VAT, “in order to

attract investors."

However, it is not proven that that is effective and, instead, the country stops receiving

money for that VAT gift.

Do you know how much money we stop receiving?

Hold on.

Sit down.

Make a cup of tea

Breathe.

And listen:

431 trillion USD

Second pearl:

The orange economy.

That magic term on which Duque has already written several books, and made an amazing

performance, but we still don't know what the hell it is.

The gift is that the income tax is deducted from companies in the sector.

But about this gift, analysts have said that it is not justified

Because the orange economy is such an ambiguous concept, so vague, so ethereal, so nothing

That other sectors can be placed and end up benefiting without needing it.

Third pearl:

They left a gift to the hotels that are being built or remodeled.

That is, they lowered the VAT rate to 9% until 2025.

This gift is supposed to promote tourism in the country

But it turns out that hotels are not the protagonists of tourism in the country:

There are tourist services, restaurants, transport, terminals,

car rentals... well, and so on.

All of them do not have the same benefits and are even more important than hotels

to promote tourism.

Fourth and last pearl:

Another void left by the government in the reform is that,

Against ALL scientific evidence out there,

It did not put an additional tax on sugary drinks.

The consumption of these drinks is related to the development of diseases, such as

Diabetes

Cavities

Cardiovascular diseases

Overweight

And obesity.

These last two are increasingly present in Colombia, and are growing like crazy in the child population.

However, see the reason that Carrasquilla gives

not to tax these beverages:

“You will remember that the president

is skeptical about the goodness of this tax, Iam not sure

that this tax has the effects on the externalities in the citizens’ health.”

But let's see: A study found that if Colombia were to

put that additional 20% tax on these drinks,

Consumption would be reduced by 32% and that would have positive impacts on health.

Also, if we think about money, this 20% tax could raise

1 trillion USD annually. And in lean times.

There could be your first trillion USD for the reform.

If the reform has already been submitted,

What 's next?

Is this going to stay like this?

Nothing can be done?

Now, all that is missing is the cherry on top of the cake which it is all the show that they are doing in Congress

with the reform discussion

Where congressmen know that giving a serious debate on this bill is more unpopular

than brussels sprouts.

In fact, a poll showed that 82% of Colombians would not vote for a candidate

who is in favor of this reform.

After all this mess, we’ve come to some conclusions:

One, yes, we need money.

Two, yes, it is good that the State gives a hand to the poorest even if those of the extreme right

are highly opposed to it.

Three, the government is ripping off the middle class and

Four, it does not ask the same of the richest.

Fifth, they are not taking money from where they should

So, sixth, that stupid speech of solidarity, keep it for yourself because it's not

true and does not apply to everyone.

And seventh, minister, all good, cool, but here between us, tell us where

do you get those really cheap eggs, ‘cause the situation is hard.

Hey. We support the strike and we know that there are good

reasons to march against this inefficient government, obviously with the mask put on well

and with all the security protocols.

We also think the decision made by the Cundinamarca Court to ban the strike

is a mistake, because protest is a right and you don't need to have anyone's permission.

The fact that this strike is done like this, in the middle of a pandemic, is a sign that people can’t take it

anymore

As Residente, Calle 13 singer said: "if a people protests and marches in the middle of a

pandemic, it is because their government is more dangerous than a virus."

Hopefully, Iván Duque, listens.

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Until next time.