Changes in Proposed Vacation Rental Taxes

A 3% additional to the 13% VAT that was expected to be charged in Costa Rica as a tax on accommodation services provided through the Airbnb platform and other similar platforms was finally removed from the bill being discussed in the Legislative Assembly.

Tuesday, March 19, 2019

Bill 20.865 for the regulation of non-traditional hosting and its intermediation through digital platforms, which is discussed in the Legislative Assembly and determines the taxes to be charged for the activity, will be modified by the Economic Affairs Commission.

You may be interested in "New Attempt to Regulate Airbnb"

Regarding the decision to waive the specific charge of 3% to the activity, reported Nacion.com that "... the legislators waived the specific tax, after the Minister of Finance, Rocío Aguilar, and the Attorney General's Office of the Republic told them the inconvenience of creating it."

The article adds that "... Initially, the congressmen wanted to allocate the collection of the 3% tax to the National System of Conservation Areas (Sinac), the Costa Rican Tourism Institute (ICT) and the Directorate General of Taxation (DGT). However, the Finance Minister warned that charging a specific tax is complex and expensive."

Also see "Airbnb, Taxes and Tourism"

By means of a legal opinion, the Attorney General's Office objected to the creation of the specific tax in question, which would be administered by the beneficiary entities, since they are institutions of the Central Government, it is convenient that the resources enter the Single State Fund.

See bill.

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More on this topic

Vacation Rentals: New Law Projected to Decline

September 2019

With the legal framework approved in Costa Rica, which regulates the provision of tourist rental services in housing through digital platforms, Airbnb executives anticipate a considerable drop in the number of hosts in the country.

On September 5, the Legislative Assembly reported that file 20865, the framework law for the regulation of non-traditional hosting and its intermediation through digital platforms, was approved for the second debate.

New Attempt to Charge Tax on Holiday Rentals

May 2017

Although Airbnb offered to collect the sales tax for transactions made in Costa Rica through its platform, the Treasury is evaluating asking the US for information on the hosts.

The Directorate General for Taxation will try to exhaust all routes first with the company Airbnb, but as a second alternative, it has announced that if it does not reach an agreement with Airbnb, it could request information on the hosts, making use of international agreements for exchange of information with other governments, such as as the US.

Taxes on Rental Accommodation in Costa Rica

February 2017

A bill being prepared by the hotel union would force platforms such as Airbnb to pay 13% sales tax and an additional 5% for national parks.

The bill is being drafted by the National Chamber of Tourism, which intends to submit it to the Legislative Assembly. If passed, this law would take effect for all platforms used for renting accommodation for tourism purposes, such as Airbnb, Homeaway and others.

Hotels are Losing War On Holiday Rentals

October 2016

In Costa Rica the total amount of accommodation available for rent through the web platform Airbnb is now equivalent to 18% of the hotels in the country.

The figure has been confirmed by the union of hoteliers, who say there is now a total of 11,000 homes offering accommodation for tourism through Airbnb. On top of this data there are also residences rented to tourists through other platforms such as Homeaway or VRBO.

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