Colombian President Ivan Duque decided to withdraw his contentious tax reform proposal after thousands of protesters took to the streets for several days.
Duque in a video said he would ask Congress “to withdraw the law proposed by the finance ministry and urgently process a new law that is the fruit of consensus, in order to avoid financial uncertainty”.
The proposed reforms, which the right-wing government had insisted were vital to stabilising Colombia’s finances, maintaining its credit rating and funding social programmes, has drawn widespread public anger and protests.
The plan included new or expanded taxes on citizens and business owners, as well as the levelling of sales tax on utilities and some food.
But many working-class Colombians, already struggling under a coronavirus-related economic downturn, said the reforms would hit them too hard.
Human Rights Watch said it had confirmed six deaths related to the protests. “I reiterate my urgent call for the protest to be peaceful and for the security forces to respect human rights,” Jose Miguel Vivanco, executive director of HRW’s Americas division, tweeted.
Lawmakers, unions and other groups hailed the announcement as a victory. Celebratory cacerolazos, a traditional protest where people beat pots and pans, could be heard in some neighbourhoods.
“It is the youth, social organisations and mobilised citizens who have seen deaths and defeated the government,” left-wing Senator Ivan Cepeda said on Twitter. “May the government not present the same reform with make-up. The citizens won’t accept tricks.”
Nevertheless, Duque on Sunday said tax reform remains necessary.
He said political parties, local officials, business leaders and civil society groups have contributed valuable ideas over the last several days.
There is consensus on the need for temporary taxes on businesses and dividends, an increase in income tax for the wealthiest and deepened state austerity measures, Duque said.