Co
alitio
n of Fina
nce
M
inisters fo
r Clim
ate
A
ctio
n
Ministry
of Fina
nce
-C
olo
mb
ia
June2019
NDC
•C
olo
mb
ia a
ckno
wle
dg
es
the im
pa
ct o
f clim
ate
issues
on fisc
al a
nd e
co
nom
ic sta
bility
•U
nde
rstand
ing the
po
tentia
l effe
ctive
ness o
f fisca
l instrum
ents to
ad
dre
ss do
uble
-divid
end
ob
jec
tives
•A
ll enviro
nme
ntal lia
bility w
ill eve
ntually b
ec
om
e a
fisc
al lia
bility
Prem
ises
Clim
ate
cha
nge
sec
toria
l pla
n
•Stra
teg
ic line
s pro
po
sed
by the
Ministry o
f financ
e:
•Ec
ono
mic
instrume
nts•
Ma
nag
em
ent a
nd a
cc
ess to
financ
ing so
urce
s.•
Ma
cro
ec
ono
mic
mo
de
ling•
Estima
tion o
f fisca
l imp
ac
ts asso
cia
ted
with c
lima
te
eve
nts•
Ca
pa
city b
uilding
•Inte
rnal m
ana
ge
me
nt
Taxes:•
Carbon tax
•Plastic bagstax
•Tax benefits for renew
able energy
•Tax benefits for electric
cars
Other instrum
ents•
Disaster Risk M
anagement
•G
reen bonds
•M
acroeconomic m
odels
•Financialinstrum
ents
Economicinstrum
ents
•C
arbontax
since2016
(Law1819).
•To generate signals for greenhouse gas (G
HG) em
ission red
uctions •
Foundations for financing the N
DC
•Support a national prod
uctive transformation low
-carbon strategy.
•O
ffsettingm
echanism-O
TCcarbon
market
•Tariff:5
USDper
tonof
carbond
ioxide.Tariff
depend
son
thetype
offossilfuel
•Fossilfuels:G
asoline,naturalgas,kerosene,liquefied
petroleumgas,
jetfuel,dieselfuel(A
CPM
),andfueloil.
•Taxable event: the sale of any of these fuels w
ithin Colom
bian territory•
Producers and importers are responsible for collecting carbon tax
•The tax is earm
arked, among others, to environm
ental issues.
Carbon
tax–
Key elements
•The
Ministry o
f financ
e is w
orking
on p
rop
osa
ls of e
co
nom
ic instrum
ents
that sup
po
rt gre
en g
row
th
•To
incre
ase
the sc
op
e a
nd re
venue
from
the c
arb
on ta
x (by
includ
ing c
oa
l that is c
urrently e
xem
pt)
•To
cha
nnel the
se re
sourc
es to
a p
rod
uctive
transfo
rma
tion lo
w-
ca
rbo
n strate
gy
•Te
chno
log
ica
l co
nversio
n and
low
-ca
rbo
n tec
hnolo
gie
s a
do
ptio
n•
Ma
king a
n asso
cia
tion b
etw
ee
n the Sta
te a
nd the
priva
te se
cto
r in o
rde
r to g
ene
rate
ec
ono
mic
gro
wth tha
t results in g
rea
ter
taxe
s for the
state
•Inno
vatio
n co
mp
etitive
ness a
nd hig
her p
rod
uctivity w
ith low
er
gre
enho
use g
as e
missio
ns
Ne
xtstep
s
•D
eve
lop
the G
EMM
ES mo
de
lin ord
er to
have
a m
od
elling
too
l to
be
tter q
uantify the
effe
cts o
f clim
ate
cha
nge
in ma
cro
ec
ono
mic
va
riab
les a
nd fisc
al p
olic
y
•To
ca
talyze
natio
nal a
nd sub
-natio
nal e
fforts thro
ugh the
pla
nning o
f a
n innova
tive, c
om
pe
titive a
nd lo
w-c
arb
on e
co
nom
y, whic
h is re
silient a
t the sa
me
time
•G
ree
nb
ond
s
•To
ide
ntify po
licy a
rea
s in ord
er to
incre
ase
the c
ountry’s m
itiga
tion
and
ad
ap
tatio
n effo
rts tow
ard
s clim
ate
cha
nge
•This stra
teg
y is alig
ned
with the
fulfillme
nt of na
tiona
l go
als inc
lude
d
in the N
atio
nal D
eve
lop
me
nt Plan 2018-2022 linke
d to
leg
ality,
entre
pre
neurship
and
eq
uality; a
nd tra
nsversa
lly in sustaina
bility a
nd
mitig
atio
n of c
lima
te c
hang
e
Ne
xtstep
s
Co
alitio
n of Fina
nce
M
inisters fo
r Clim
ate
A
ctio
n
Ministry
of Fina
nce
-C
olo
mb
ia
June2019