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Colombia Bans Tax Evasion With National Digital Currency: Report

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Colombia tax evasion plan

Amid Colombia’s economic growth that exceeded expectations in the second quarter, an official at the country’s tax and customs agency has hinted at some plans for a national digital currency.

Luis Carlos Reyes, head of Colombia’s National Tax and Customs Authority, has claimed that the government of newly inaugurated Colombian President Gustavo Petro will seek to create a digital currency to prevent illicit financial activity such as tax evasion.

Colombia’s digital currency plans are part of the country’s new monetary policy measures aimed at increasing the transparency of financial transactions, the official said. He said In an interview with the local magazine week. According to the report, tax evasion in Colombia is estimated to account for 6% or 8% of the country’s GDP to date.

Reyes also noted that a potential digital currency would be of great benefit to the user experience, saying, “Creating a digital currency will make these transactions easier for the consumer.”

The official did not specify what kind of digital currency the Colombian government would be looking to launch, a central bank digital currency (CBDC) or rather a national currency backed by assets similar to Venezuela’s petroleum digital currency project.

Hernando Vargas, former Technical Deputy Governor of the Central Bank of Colombia It is considered The implications of a Colombian retail central bank digital currency as early as 2022. The official noted that cash is the preferred tool for low-cost payments in Colombia, citing potential threats from cryptocurrencies and stablecoins in certain circumstances. He said:

“The line of defense against the widespread use of cryptocurrencies and stablecoins is weaker in Colombia than in other jurisdictions, and the debate about the adoption of a digital currency for digital goods for retail is especially interesting.”

This news comes shortly after the new Colombian President Petro was sworn in on August 7. In 2017, Petro suggested that BTC could remove power from the government and return it to the people. “Virtual currency is pure information and therefore energy,” Pietro said at the time.

According to the latest reports, Colombia’s economy get over The second-quarter forecast was a boost for the Petro government, with GDP reportedly rising 12.6% versus expected growth of 12.1%.

*This article originally appeared on Cointelegraph.

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