Colombia’s investment grade status at stake in tax battle

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Gideon Long in Bogotá

Colombia’s decade-old status as an investment grade nation will be put to the test as the government of Iván Duque tries to pass a fiscal reform package to steady an economy that has gone haywire during the coronavirus pandemic.

Duque says he will present the package to congress in March with the aim of getting it approved by June. If the timetable slips, there is a danger his proposal will become mired in the country’s legislative and presidential election campaigns for 2022, which will begin in earnest late this year.

“The longer they wait the harder it’s going to be and it increases the risk of a watered-down tax reform,” warned Richard Francis, director of sovereign ratings at Fitch Ratings.