Costa Rica: Details of Anti Tax Evasion Bill

Limiting the deduction of interest from income tax and eliminating the exemption from payment of 15% for dividend distribution between companies are part of the changes included in the project.

Tuesday, August 19, 2014

The Bill to Improve Anti-Tax Fraud, presented by the Ministry of Finance amends various tax issues that must be taken into consideration by companies operating under Costa Rican law.

Elfinancierocr.com notes that "...among the reforms to the Law on Income Tax, is the creation of Article 8a which puts a limit on the deductibility of interest ... That is to say, the tax payer may deduct financial expenses provided that their debts do not exceed a three to one ratio on stockholders' equity to book equity, share capital, reserves and retained earnings. "

Also proposed is "reform ... to Article 16 of the Law on Income Tax ... which provides that the exemption that exists today of the payment of 15% on the transfer of dividends from corporations will be removed ....In addition ... the basis of the taxable income will be broadened to include a series of revenues which currently do not form part of the calculation of the tax."



More on this topic

Honduras: Businessmen Resist Anti Evasion Law

June 2012

The Honduran Council of Private Enterprise says that reform of the Law on Income Tax is unconstitutional because it is confiscatory.

An article in Elheraldo.hn reports that "The Honduran Council of Private Enterprise (COHEP) argues that legislative approval of the Evasion Measures Act to income tax is unconstitutional, confiscatory and violates a judgment of the Supreme Court dated February 1, 2012. "

Guatemalan Coffee Growers Reject Anti-Evasion Plan

September 2011

The coffee sector has announced its opposition to a proposal to establish a 5% surcharge on Income Tax (ISR in Spanish) for the agricultural sector.

A press release by Anacafé states:

The Guatemalan coffee industry via the National Coffee Association, Anacafe, has expressed concern about the establishment of a 5 percent surcharge on Income Tax,, referred to in the draft Anti-Evasion Act II which is now being considered in the Congress of the Republic. Political parties in their current campaigns have said that they will not raise taxes, their representatives in the legislative body have already made agreements to approve them.

Anti-evasion Law Creates Controversy in Honduras

April 2011

Businesses complain that the new law will give unlimited power to tax authorities to seize companies's information.

Armando Urtecho, director of the Honduran National Business Council (Cohep in Spanish), added that, "we are against too much power being given to the tax authority (DEI in Spanish) with less capacity remaining with judges to decide what is appropriate," reports Elheraldo.hn.

Guatemala Seeks to Raise $58 Million with 'Anti-evasion Law'

April 2011

A new attempt is being made by the Álvaro Colom government to increase tax collection by enforcing the so-called 'Anti-evasion Law'.

The bill contains administrative measures to improve control over and auditing of existing taxes as well as standardize aspects that seek to combat tax and customs fraud and smuggling, according to a communication from the Finance Ministry.

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