Unions and business associations are insisting that the economy will be damaged if the proposed tax reform is approved by the Executive.
The private sector is objecting to the negative impact that the reform will have on the national productive apparatus and consumers. Unions for their part say the new tax (Value Added Tax, VAT) will affect the finances of Costa Rican families.
If the act is approved in the Economic Matters Commission, the bill would move on to the Legislative Assembly.
The idea is for the bill to be passed before the end-year recess, which starts December 18th.
"This project extends the existing Free Zone law by adding a new category for manufacturing companies, and puts the country in line with WTO Agreements on subsidies and compensatory measures", reported Elfinancierocr.com.
Since December 2008, exports of the businesses inside the duty-free zone have begun to decrease.
Hassel Fallas writes in Nacion.com: "The duty-free zones exported 2% less ($84 million), according to the yearly variation from December of 2008 and they decreased 4% between January 2008 and January 2009. In the last 12 months that ended last month, the country stopped receiving $184 million related to the accumulated total."
The companies are asking for reforms to the Law of Incentives that would allow a reduction in income tax starting 2015.
Nacion.com reports on its website: "Timothy Scott, director of the Association of Free Zone Companies (Azofras), explained that the companies are asking that the new tariff that will come into effect in 2015 be "one digit" (less than 10%).
In response to the economic crisis the Government is proposing to make the work day more flexible in order to minimize layoffs.
According to nacion.com "the bill proposes creating new two work days: a 12 hour day with 3 free days per week and an annualized work day. This will allow for 10 hours when there is a lot of work and a maximum of six during the low season, and this way the workers will at no time get less than the minimum wage.
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