colombianherald.com

The automotive sector and Colombian consumers face a possible significant increase in the prices of combustion vehicles, after the Ministry of Commerce, Industry and Tourism published a draft decree that proposes increasing import tariffs up to 40% for passenger cars (item 87.03).

The measure is part of the National Government’s reindustrialization and energy transition policy, seeking to discourage the importation of gasoline and diesel vehicles, which do not have tariff benefits due to free trade agreements, and thus promote cleaner technologies and local production.

The draft decree seeks to raise the tariff rate for these vehicles, which would directly impact models that come from countries without Free Trade Agreements (FTA) in force with Colombia.

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Economic analysts and unions in the sector have expressed concern, pointing out that an increase of this magnitude could drastically reduce the supply of vehicles, increase costs for the final consumer and generate a contraction in the automotive market that already faces challenges.

The increase seeks, ultimately, to pressure a reorientation of the market towards the import of electric and hybrid vehicles, which enjoy very low tariffs, or even 0%, depending on their specifications.

The draft decree is expected to generate intense debate during the public comment period before the Government makes a final decision on implementing the drastic new tariff rate.

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