Colombia Exempts IT Firms from Sales Tax

Colombia has exempted IT companies from paying sales tax on software development and export as the Andean country attempts to generate more jobs in the technology sector. This was a long-standing demand from companies in the IT sector, stated the national ICT ministry known as Mintic.

“This measure motivates entrepreneurs to set up software firms and expand overseas. All this we do to give a boost to the IT industry, which translates into more jobs and less poverty,” said ICT Minister Diego Molano Vega, in a press release.

The tax exemption comes in the wake of government’s plans to launch six software development centers across the country, each dedicated to developing software for specific verticals of the economy.

Colombia appears to have ambitious plans to boost its technology sector. It is currently gearing up to make a new spectrum available to help telecom carriers expand coverage in rural and remote areas of the country.

Outsourcing accounts for around 40% of Colombia’s IT services sector, according to Proexport. IDB, which recently lent Colombia $12 million to help promote the country’s outsourcing services industry, says the South American country has immense potential to grow as a global outsourcing destination.