After in Costa Rica the mayor of Alajuela filed an action of unconstitutionality to revert the authentic interpretation approved by the deputies for the payment of real estate taxes applicable to free zones, the Chamber ruled negatively to the legal recourse filed.
The magistrates determined that the allegations presented on March 16, 2021 by Humberto Soto, mayor of the municipality of Alajuela, were incorrect and the appeal was rejected.
In 2015 331 active companies were registered, of which 52% are devoted to services, 45% to manufacturing and the remaining 2% to the food industry.
From the executive summary of the study by PROCOMER"Balance of Free Zones: Net profit regime for Costa Rica 2011-2015":
1. Net National Product (NNP) for the operation of the Free Trade Zone System (FTZ) in 2015 reached a value of $3.179 billion, reflecting a growth of 5% compared with 2014.The NNP grew faster than the economy, which last year showed dynamism of 3.7%.Firms in the service sector were the largest contributor to this NNP, with an average share of 47%.
In Costa Rica, pressure from employers to maintain tax exemptions in free zones is increasing.
According to an article in Elfinancierocr.com at a meeting of a group of businessmen which included the main force behind the increase in taxes in the free zones, the former presidential candidate Otton Solis, there were no positive results, and the same outcome was seen at a meeting held with the full bench of the Citizen Action Party, of which Solis is the leader.
The Foreign Trade Promoter has revealed in a study the benefits that free trade zones contribute to the country, including the 58 thousand jobs that pay 60% above the average private sector salary.
From a press release by PROCOMER:
A study by PROCOMER reveals the benefits of free zones in Costa Rica:
- Companies under this regime have become a source of employment for 58,000 Costa Ricans whose wages are 60% higher (1.6 times) than the average national wage in the private sector.
In Costa Rica, the Association of Free Zones and Investment promoter CINDE are lobbying against the imposition of new taxes on businesses.
The proposed measure, now under a fast track approval system in the Legislature, include a tax on dividends for those companies who establish themselves in in the zone after 2015, plus requirement to pay municipal taxes.
The Executive and Ministry of Commerce are clashing over the collection of taxes from 2015 from companies in free zones or industrial parks, included in the tax reform bill.
The new regulations are included in the proposed fiscal reform presented by the government to the Legislative Assembly.
President Laura Chinchilla, was emphatic on the need to approve the fiscal plan in Congress,” ‘so that the country does not go straight into a highly volatile economic situation’.
Modifications to the Costa Rica Free Zone and Active Improvement Regime include 52 procedures that can be performed online.
Among the steps that can be done online is the facility for businesses to apply for entry into the free zone regime, and changing the level of investment as well as the minimum level of employment.
Procomer General Manager, Jorge Sequeira, said the procedure simplifications are aimed at attracting more foreign investment into the country.