Bogota Tax Reform Raises Alarm Across Colombia’s Fintech Sector
Bogota is moving forward with a major overhaul of its local tax system that would significantly increase the tax burden on some financial activities, prompting concern across Colombia’s fintech ecosystem over the potential consequences for startups, investment and innovation. The measure is part of Bogota’s Draft Agreement 724 of 2026, known as the “Smart City […]
Bogotá’s tax reform is sparking controversy within Colombia’s fintech sector. The proposal, part of the city’s broader initiative to simplify taxation and attract investment, would increase the tax burden on certain financial activities. This has raised concerns among fintech companies about the potential impact on startups, investment, and innovation.
The most contentious aspect of the proposal increases the rate applied to major financial activities, directly affecting fintech companies. Gabriel Santos, president of Colombia Fintech, has become a vocal critic, warning that the reform could undermine Bogotá's position as a regional hub for entrepreneurship and financial technology.
Santos argues that the reform could place a heavier tax burden on companies that generate revenue before becoming profitable, potentially hindering their growth. The controversy intensified when Bogotá's City Council approved Article 21 of the proposal on September 24, which would raise the tax rate to 20 per thousand through 2027, declining to 19 per thousand in 2028 and settling at 18 per thousand from 2029.
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