Colombia faces extreme wealth concentration and social inequality, as the richest 1% hold 40% of the wealth while the poorest 50% only hold 2%. Tax evasion among the wealthy contributes to this disparity, with the tax system inadequately addressing wealth distribution. The tax structure is regressive, focusing predominantly on consumer goods taxes like VAT, rather than on progressive direct taxes. Consequently, the wealthy pay lower tax rates compared to the poorest, undermining economic equity and exacerbating food insecurity among millions of Colombians.
Many of the country's richest people have evaded taxes for decades, leading to a paradox where their wealth increases while their tax contributions stagnate.
According to the World Inequality Database, the wealthiest 1% in Colombia holds 40% of total household wealth, while the poorest 50% holds only 2%.
Colombian billionaires pay proportionally less in taxes than the poorest, with the richest 1% paying an average of 17 cents in taxes per dollar of income.
The national tax structure heavily relies on regressive consumer taxes, while little is raised from progressive direct taxes, exacerbating inequality.
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