One Step Closer to a Tax Reform

The Costa Rican Congress has approved a fast track bill that would transform sales tax into a VAT of 13% and establish a 4% rate on the purchase of packaging, wrapping and raw materials, among other things.

Thursday, March 1, 2018

The bill that could be approved by the Legislative Assembly also includes "... taxes on books in all their formats, air tickets, purchase of packaging and raw materials, as well as equipment and machinery (except if there is an express exoneration) and services for agricultural and agroindustrial production."

See "Costa Rica: More Warnings Over Fiscal Deficit"

The initiative also contemplates charging a 15% tax on capital gains. The 13% Value Added Tax would be levied on the other assets, with some exceptions and maintaining the exonerations in force.

See also: "Juggling public finances" reports that "...The plan also proposes establishing a ceiling of ¢5.4 million on the salaries of public officials and the heads of State Powers and Public Administrators. The equivalent of 18 minimum monthly salaries for the lowest income category in the private sector."

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Costa Rica Prepares New Tax Measures

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The project aims to reduce the fiscal deficit, which currently stands at 3.2% of gross domestic product, and could be approved by the plenary of the Legislative Assembly before the end of the year.

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