The federal government of Colombia revealed it has plans to launch a digital foreign money. One of many functions of this new foreign money can be to curb tax evasion and improve the traceability of transactions made by residents. The proposed measure would even be accompanied by restrictions on money funds and transactions of over 10 million Colombian pesos ($2,400).
Colombia to Launch Its Personal Digital Foreign money
Many nations at the moment are trying to digitize a part of their economies in order to raised perceive and management the circulation of cash in their economies. The federal government of Colombia is planning to launch its personal digital foreign money in the close to future, based on statements provided by Luis Carlos Reyes, head of the DIAN, the Colombian tax authority.
Reyes informed native information outlet Semana this might be one of many proposals of the newly inaugurated president Gustavo Petro in order to curb tax evasion, estimated to be between 6% and eight% of the GDP of Colombia. On this observe, Reyes acknowledged that the aim of this digital foreign money can be to boost the traceability of those transactions so retailers can not evade taxes utilizing money as a cost methodology.
On the effectiveness of the measure, Reyes estimated:
That is equal to 6 or eight tax reforms which were made in the nation, with which a most of 1% or 1.5% of GDP is obtained.
Nonetheless, Reyes didn’t disclose any traits of the digital foreign money or the way in which in which it might work alongside the normal cost techniques in the nation.
Money Restrictions
The introduction of the digital foreign money would even be accompanied by different measures which can be presently being studied. Certainly one of these measures is a restriction on funds in money over a certain quantity. Reyes confirmed this quantity can be 10 million Colombian pesos, or roughly $2,400.
Nonetheless, these modifications may disrupt the cost channels of Colombians. Whereas using money for funds was decreased through the Covid-19 pandemic, money is presently one of many important strategies of cost in Colombia. Statistics from the Central Financial institution of Colombia present that the circulation of payments has risen to its highest quantity in 17 months.
In response to information from the Monetary Superintendency, Colombians nonetheless desire money as their important cost methodology when paying for transportation (94%), groceries (80%), mobile phone top-ups (78%), and hire (77%).
What do you consider the proposal of a digital foreign money in Colombia and the proposed restrictions on money funds? Inform us in the feedback part beneath.
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