BOGOTA (Reuters) - Colombia's government is expected to hike its 2023 budget by some 23 trillion Colombian pesos ($4.71 billion) in a proposal to be sent to Congress Friday, the country's interior minister said Thursday.
Almost all of the additional funds will come from a recently passed tax reform Interior Minister Alfonso Prada (OTC:PRDSY) said in a radio interview. The reform increases duties on oil and coal, raises income taxes on the rich and targets single-use plastics and processed food and drinks.
The extra cash will go towards purchasing land for planned agrarian reforms backed by President Gustavo Petro, towards expanding the education system and kickstarting proposed health reforms yet to be passed by Congress.
Finance Minister Jose Antonio Ocampo said Wednesday he was committed to ensuring the government's proposals meet fiscal code and reduce public debt.
Petro formed a strong coalition in Congress with left-, center- and right-wing parties, which passed the tax reform in late 2022.
An additional 20 trillion pesos will be raised every year for the next four years due to the changes, and the funds are aimed at backing Petro's wide-ranging social programs.
In addition to the pending health reform, Petro also hopes to change the country's labor and pension systems, and offer free university education to low-income students.
More than half of Colombia's population lives in poverty, according to government data.
($1 = 4,878.24 Colombian pesos)