A Landmark Reform for Public Health and Development
The Colombian government has presented its third tax reform under President Gustavo Petro’s administration.
According to reporting by El Tiempo, the reform aims to raise 26.3 billion pesos to finance the 2026 national budget.
It includes health-focused measures that specifically target alcohol products, with the government stating that this is a way to promote people’s health while generating much-needed revenue. In fact, the reform will raise the price of liquor and cigarettes, with alcohol taxation playing a central role.
Key Changes to Alcohol Taxation
The reform proposes a shift in how alcohol is taxed. Noticias Caracol reports that the taxable base, which was previously the retail price certified by the National Administrative Department of Statistics (DANE), will now be split into two parts:
- A specific component based on alcohol content, and
- An ad valorem component based on the retail price.
For example, the excise tax rate for liquors, wines, and aperitifs will be set at $750 for each percent of alcohol per 750 milliliters, plus a 30% ad valorem rate. For beer, siphons, and refajos, the specific component will be 330 pesos per alcohol content in a 330 ml unit, plus a 30% ad valorem rate.
Additionally, the memorandum highlights that VAT on alcohol will increase from 5% to 19%. This change means that products such as aguardiente, rum, whiskey, vodka, and wines will all become significantly more expensive. For instance, VAT on a 750 ml bottle of aguardiente will rise from about 955 pesos to more than 3,600 pesos, an increase of over 200%.
Expected Price Impacts
The impact of these changes is substantial. According to Teleantioquia, the price of a 750 ml bottle of aguardiente could increase from 37,000 pesos to 52,000 pesos, a jump of nearly 45%. The final consumer price could climb even higher, with estimates suggesting a rise of up to 60%.
Similarly, Infobae reports that beer prices could rise between 30% and 50%, with a can of Club Colombia increasing from 3,600 pesos to 4,300 or 4,500 pesos. These higher prices are expected to discourage alcohol use, which is the government’s stated goal because it promote health, prevents harm and reduces costs.
People’s Health and Social Benefits
The proposed tax reform reflects urgent needs for alcohol prevention. According to Movendi International reporting, alcohol is responsible for nearly 10,000 deaths annually in Colombia. It is the leading risk factor for death among people aged 15 to 49, and more than 70% of years of life lost to injuries are linked to alcohol, including violence, self-harm, and traffic crashes. Children also suffer: in 2019, 400 children and adolescents died due to alcohol. These are devastating but preventable harms.
The reform also aligns with global recommendations. A World Bank analysis, cited by Movendi International, shows that restructuring Colombia’s alcohol tax by volume and alcohol content could reduce alcohol use by 11%, prevent 1,400 deaths each year, and increase government revenue from 4.5 trillion to 7 trillion pesos.
This makes it a powerful prevention tool that boosts both people’s health and national development.
People’s Support for Better Alcohol Policies
Evidence shows Colombians want decisive alcohol policy action. According to a survey referenced by Movendi International:
- 84% of Colombians support better alcohol policy,
- 62% believe higher alcohol taxes reduce use, and
- 59% say the alcohol industry interferes with policymaking.
This support highlights that people view alcohol harm as a national concern, and that more ambitious and evidence-based policy measures have broad backing.
A Turning Point for Colombia
As Movendi International emphasised in an official letter to Colombia’s President, this reform is more than a fiscal adjustment. It is a commitment to protecting people’s health, reducing inequality, and ensuring the alcohol industry pays its fair share for the harm it causes.
By implementing this evidence-based policy, Colombia has the opportunity to save thousands of lives, generate vital resources for health and education, and promote social justice. The reform marks a turning point towards a healthier and more prosperous future for all Colombians.
Sources
Noticias Caracol: “Tax Reform 2025: This is the proposed liquor tax increase in the Financing Law”
Valora Analitik: “Beer prices in Colombia would rise this way with Petro’s new tax reform”
Caracol Radio: “Tax reform: Liquor, cigarettes and concerts would be affected”
Presidencia de Colombia: “Government submitted $26.3 trillion Financing Law project to Congress”
Infobae Colombia: “Bars and restaurants would have to raise prices on these products if the tax reform is approved”
W Radio: “FLA on Petro Government’s tax reform: It will encourage smuggling and adulterated liquor”
Teleantioquia: “FLA Manager: ‘This tax reform is the end of the liquor industry in Colombia which generates much of the health sector resources'”
Movendi International: “Press Release: “Alcohol Tax Reform in Colombia: A Turning Point for People’s Health, Justice, and Prosperity”
Explanatory Memorandum: “Excise duty and value added tax on alcoholic beverages“
Movendi International: “Official Letter of Commendation”