A year after first being proposed, and under different economic conditions, progress has been made on the adoption of the law to discourage "hot" capital.
From a press release issued by the Legislative Assembly of Costa Rica:
MPs voted in a first debate, to put a brake on the entry of speculative capital into the country, known as hot money, with an initiative submitted for discussion by the Executive.
The bill which taxes interest generated by speculative capital has been stalled because it respective Legislative Commission has not been formed yet.
Edgar Ayales, Finance Minister recalled the significance of the future law and added that the problem could take three or four weeks.
"This is because, according to the vice minister of the same portfolio, Randall Garcia, they have not yet officially named the new team for the Treasury Commission, which manages the topic", reported Prensalibre.cr.
The taxes and proposed measures to control the influx of "hot capital" could be confiscatory and in violation of the principles of reasonableness and proportionality.
The bill which aims to grant extraordinary powers to the executive branch to regulate the entry of foreign capital into the country was approved in committee and has been passed to the legislative plenary for discussion.
The Chamber of Banking and Financial Institutions has responded to inquiries from legislators about the proposed "Act to discourage the inflow of foreign capital."
A statement from the Chamber of Banking and Financial Institutions reads:
Regulation of "Hot Money" entry
• Current wording of the document may affect "healthy" investments made in the country, to the detriment of various productive sectors which depend on them.