Colombia’s first leftist president has unveiled a bold tax plan aimed at raising $11 billion per year for anti-poverty programs.

BOGOTA, Colombia — On Monday, Colombia’s first leftist president unveiled an ambitious tax plan that aims to raise $11 billion per year for anti-poverty programs.

Gustavo Petro was sworn in as president on Sunday, promising to combat economic inequality while investing in rural areas plagued by drug-related violence.

Less than 24 hours after taking the presidential oath, the new president presented his country’s congress with a tax reform plan that will raise income taxes on the wealthy and impose a 10% levy on oil exports. A wealth tax on individuals with a net worth of more than $750,000 is also included in the bill, as are sales taxes on soft drinks and highly processed foods.

Petro, a former rebel leader, has stated that Colombia must increase state spending to combat poverty and implement a 2016 peace agreement with the Revolutionary Armed Forces of Colombia, which includes land reform and rural development programs.

In 2020, tax collection in the South American nation was worth roughly 19% of the total GDP, which was slightly lower than the Latin American average. Members of the OECD, which is mostly composed of developed countries, collect an average of 33% of their GDP in taxes.

Colombian governments have long struggled with tax collection because a large portion of the population works in the informal economy. Last year, conservative President Iván Duque’s attempt to raise income and sales taxes sparked massive protests in which more than 50 people were killed.

In 2020, tax collection in the South American nation was worth roughly 19% of the total GDP, which was slightly lower than the Latin American average. Members of the OECD, which is mostly composed of developed countries, collect an average of 33% of their GDP in taxes.

Colombian governments have long struggled with tax collection because a large portion of the population works in the informal economy. Last year, conservative President Iván Duque’s attempt to raise income and sales taxes sparked massive protests in which more than 50 people were killed.

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