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Colombia Import Regs.: Tariff, taxes, pricebands

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Colombia Import Regs.: Tariff, taxes, pricebands

Postby bridgat » Tue Nov 18, 2008 4:19 am

On December 27, 2006, the GOC issued Decree 4589/2006 establishing the the 2007 tariff schedule (non-FTA) by product at the eight-digit HS level. This Decree provides additional regulations concerning importing, including treatment of parts, etc.

Import duties are quoted ad-valorem on the CIF value of shipments. Generally duties (with a few exceptions) have been consolidated into four tariff levels as follows:

-- 5 percent for raw materials, intermediate and capital goods not produced in Colombia;

-- 10 and 15 percent for goods in the above categories but with domestic production registered in Colombia;

-- 20 percent for finished consumer goods; and

-- some exceptions to these general rules, such as import duties for automobiles which remain at the level of 35 and 40 percent and some agricultural products which fall under a variable import duty system (price band). Tariff exemptions are listed below:

Regime Characteristics Time limit Basis in law
Reimportation in the same state Goods exported temporarily or outright which were in free circulation, provided they have not undergone modification abroad Up to three years Article 140 of Decree No. 2685 of 1999
Temporary admission for re-exportation in the same state Importation of certain goods intended for re-exportation within a specified period, without having undergone any modification, other than normal wear and tear. Fungible goods and those that cannot be fully identified cannot be imported under this procedure. DIAN determines by resolution those goods that are eligible for short-term or long-term temporary admission. (a) Short-term, maximum period of importation six months from release of the goods, with a possible extension for a further three months; or (b) long-term, for capital goods, their parts and accompanying accessories necessary for their normal functioning, with a maximum of five years from release of the goods. In special circumstances, DIAN may grant a period greater than the maximum. Articles 142 to 161 of Decree No. 2685 of 1999
Temporary admission of capital goods for inward processing Temporary admission of capital goods, their parts and spares intended for re-exportation after repair or overhaul. DIAN determines by resolution the goods that can be placed under this procedure. Not more than six months. Where there is good cause, DIAN may authorize an extension for a period not exceeding that initially granted. Articles 163 to 167 of Decree No. 2685 of 1999
Temporary admission for inward processing under the special import–export systems Temporary admission of raw materials and inputs for re-exportation, total or partial, after having undergone processing, manufacturing or repair. Not more than six months. Where there is good cause, DIAN may authorize an extension for a period not exceeding that initially granted. Articles 168 to 183 of Decree No. 2685 of 1999
Temporary admission for industrial processing Temporary admission of raw materials and inputs for re-exportation after having been worked, processed or manufactured, by industries recognized as "high export users" and authorized as such by DIAN. Not more than six months. Where there is good cause, DIAN may authorize an extension for a period not exceeding that initially granted. Articles 184 to 188 of Decree No. 2685 of 1999
Importation for processing or assembly Importation of goods for processing or assembly, by industries recognized by DIAN for that purpose. The period authorized by DIAN for processing. Articles 189 to 191 of Decree No. 2685 of 1999
Free and special warehouses Goods from abroad which remain in free warehouses are exempt from the payment of customs duties and consumption tax and are treated as having been temporarily admitted for re-exportation in the same state. None Articles 63 and 64 of Decree No. 2685 of 1999
Hydrocarbons and mining industry The hydrocarbons and mining industry will have the provisional advantage, up to 19 October 2010, of tariff exemptions applicable to imports of machinery, equipment and spares intended for the extraction, treatment, processing and transport of minerals and the recovery, pipeline transport and refining of hydrocarbons. None Decree No. 4743 of 2005
Shortage of subregional supplies CAN has authorized Colombia to grant duty-free admission subject to confirmation of a shortage of subregional supplies, for five years. None CAN Resolution No. 880 of 2004
Goods for extractive activities Resolution No. 969 of 2005 authorized duty-free admission for goods for extractive, mining and petroleum activities, for public policy reasons. None CAN Resolution No. 969 of 2005
Import duty suspension regime, Automotive Sector Agreement (Colombia, Ecuador, Venezuela) The duty rate for imported parts and components is 0 per cent. None Article 7 of the Complementarity Agreement for the Automotive Sector 1999 (Colombia, Ecuador, Venezuela); Resolution No. 0701 of 2002

Source: WTO

Colombia has signed several other multilateral free trade agreements that affect trade. Among the most important are: The Latin American Integration Association (LAIA) with Argentina, Bolivia, Brazil, Chile, Ecuador, Mexico, Paraguay, Peru, Uruguay, Venezuela, El Salvador, Costa Rica, Guatemala, Nicaragua, and Honduras; the Bilateral Free Trade Agreement with Chile; and the G-3 (Group of Three) with Venezuela and Mexico. The recent FTA signed with the United States may in the future reduce tariffs on US originating products.

Standard Value-Added Tax of 16%

DIAN (IRS approximate equivalent) Circular 009 of January 17, 2007 maintains the IVA exemption on personal computers (desktop or portables) valued at approximately US$900 and below, whether imported or assembled locally.

VAT rates different from the standard rate: Selected items -- beer, wine, cigarettes, etc; excise of 35% applies to whiskey aged up to 12 years and 20% on whiskey aged 12 years or more. Some other products and services may be subject to different VAT rates.

The VAT applied to automobile imports and depending on engine displacement are 20, 35, and 40% on lowest to highest displacement, respectively. 40 percent VAT applies to imported vehicles with invoice value of $40,000 or more and a possible variable sales tax, ranging between 16 and 60 percent, depending on the type of vehicle, the size of the engine, its intended use, and its price. Also, Resolution 2446, issued March 20, 2001, established fixed minimum official prices for 2001 vehicles on which the appropriate taxes are applied.

- 35 percent VAT on distilled spirits, with a 20 percent VAT on spirits aged more than 12 years.

Price Bands for Agricultural Products

On April 1, 1995, Colombia applies the common Andean Community price band (variable import duty system) covering thirteen basic commodities (white rice, malting barley, yellow corn, white corn, soybeans, wheat, crude palm oil, crude soybean oil, white sugar, raw sugar, powdered milk, chicken parts, and pork meat) and 134 additional commodities that are considered substitutes. The system is purportedly intended to cover domestic producers and consumers from volatile world prices by raising import duties when import prices are low and lowering duties when prices are high.


Tariffs and taxes applied on software imported into Colombia are assessed on the medium used (i.e. diskette, CD-Rom) and are levied on the invoice amount or declared value.

If the original invoice reflects the cost of the software including manuals and the medium used, then duties and VAT are applied on the transaction value as determined by agreements. This can be either the cost of the media or the the cost of the media plus the intellectual property.

When software updates are included in the original invoice, no import duties and taxes are applied to the future updates. .

Software licenses in Colombia are assessed duties and taxes. A withholding tax of 35% is imposed on 80% of the value of the licensing fee.

A withholding tax of 35% is imposed on 80% of the value of the licensing fee for software delivered to the end-user via the Internet.

A withholding tax of 10% is levied on consulting services.

Refurbished/used equipment is assessed duties and taxes on the duty-paid value (CIF+duty) of the imports. The original FOB price when new (or the resulting price when rebuilt/refurbished by 70% or more) in the country of origin and/or purchase, less depreciation percentages (about 10% per year) applied for the years of use, constitute the customs base value for assessing the CIF import duties and surchages.

Repaired equipment is assessed duties and taxes and are applied on the aggregate value abroad, plus other expenses (i.e. transportation, expenses).
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