Because in Costa Rica the regulations authorizing companies to reduce working hours expire in December 2020, businessmen in the tourism sector are asking the Assembly to extend the deadline.
When the first cases of covid-19 were registered, the "Law Authorizing the Reduction of Working Days in view of the National Emergency Declaration" was approved. The validity of this regulation expires next December, but, the businessmen see the need to extend its validity.
After the UCCAEP in Costa Rica began to negotiate the lifting of the blockades with the self-proclaimed group Rescate Nacional, promoter of the protests, several business chambers distanced themselves from that decision and others have expressed their support.
Given the wave of protests and blockades that have been reported in the country, which arose after it was reported that to access a loan from the International Monetary Fund for $1.75 billion, the governmentplanned to tax financial transactions, raise the tax on the profits of companies and persons, and increase the tax on real estate. The Costa Rican Union of Chambers and Associations of the Private Business Sector (UCCAEP) decided to negotiate the lifting of the blockades.
Because the Costa Rican Assembly is discussing a bill that seeks to give municipalities the power to declare a dry law in their jurisdiction due to a national emergency, hotels, restaurants and tourist establishments are asking to be exempted from the rule.
The Legislative Plenary approved in first debate the file 21,281 Law to restrict the commercialization of drinks with alcohol content in sports activities and shows, this after the initiative had to be taken back to first debate to amend some details that the deputies considered necessary, informed the Assembly on July 16.
Attracting executives, pensioners and people willing to work remotely from Costa Rica, who extend their stay in the country for long periods, are some of the business opportunities that businessmen have detected in the current commercial scenario.
Although the sector is practically in the zero season, since the outbreak of covid-19 Costa Rica closed the borders to tourism, and during April and May there were practically no visitors to the country, the businessmen are beginning to prepare themselves to face the new commercial reality that arose from this abrupt change in the ways that people relate to each other on a global level.
Because of the restriction measures decreed in the country due to the covid-19 outbreak, between March and April of this year the average hotel rate for two people decreased from $160 to $120.
According to the "Monetary Policy Report" prepared by the Central Bank of Costa Rica (BCCR), in the face of the health crisis, hotel occupancy in the country has plummeted in the first four months of the year, from 90% in January to 15% in April.
Because of the country's economic situation, between 2017 and 2018 there was a 2% drop in the number of Costa Ricans who left from Juan Santamaria Airport and 4% in total expenditures abroad.
Aeris Costa Rica figures detail that between 2017 and 2018 the number of national departures from Juan Santamaria Airport went from 793,000 to 780,000. Regarding 2019 data, up to September the figure reaches 579,000.
During the first semester of 2019, foreign tourists in Costa Rica spent $2,228 million, exceeding by 3.8% what was reported in the same period of 2018.
Data from the Central Bank of Costa Rica indicate that between January and June 2018 and the same period in 2019, tourist spending increased by $81 million, from $2,147 million to $2,229 million.
In Costa Rica, a court decided to cancel the patent for the invention of the "canopy" that since 1998 was held in the name of a person, who charged the tourism companies that carried out the activity.
On April 24, the Administrative Registry Court decided to cancel the canopy patent that had been granted to the Canadian Darren Hreniuk, which he received in October 1998 from the Industrial Property Registry.
The VAT that will be gradually collected in Costa Rica over four years would put tourism businesses in a disadvantageous position, since they will have to increase product prices or reduce their profits.
The implementation of Value Added Tax (VAT) will be done gradually, from 0% in the first year, 4% in the second year, 8% in the third year and 13% from the fourth year, a situation that would make the operation of tourism companies more expensive.
Although between 2017 and 2018 the average spending of tourists in Costa Rica fell 14%, businessmen estimate that the country has the capacity to absorb more demand.
Figures from the Costa Rican Tourism Institute (ICT) specify that in the last two years the average expenditure made by tourists who arrive in the country decreased by $226, going from $1,561 in 2017 to $1,335 in 2018, and the stay per person remains around 12 nights.
Lack of Internet access in some areas of Costa Rica is hindering use of the electronic receipt issuance system, which in November must be implemented by all companies.
In March the Ministry of Finance reported that between September and November of this year all companies in the country had to start using the compulsory electronic billing system.
Greater air connectivity is one of the factors that explains the increase in income generated from tourism activities in the first quarter in Costa Rica, when $1.182 billion was reported.
The travel category, in the exports section of the Balance of Payments, is composed mostly of the expense of foreigners who arrive for holiday trips, and the increase reported in the first quarter, which is the high season, is attributed to good promotion of the country and better air connectivity.
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.
Protests have been made in Costa Rica over the Treasury's intention to charge sales tax on services provided in recreation centers, contravening a ruling made by the Administrative Court in 2015.
The National Chamber of Tourism said that three companies in La Fortuna de San Carlos received notification from the Directorate General of Taxation which indicated that they were required to pay sales tax of 13% on recreational services offered to tourists.
The Canadian government is warning tourists that levels of violence and crime in the country are growing and has recommended exercising a high degree of caution when travelling there.
Unfortunately Costa Rica is no longer the exception in the region in terms of violence and insecurity, which is already directly affecting tourism, one of the most important productive sectors in the economy.
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