In Costa Rica, taxpayers interested in benefiting from exemptions or reduced rates of payment of Value Added Tax must register with the Directorate General of Taxation.
The changes were detailed on October 15, 2019, when the resolution of the General Directorate of Taxation (DGT) No. DGT-DGH-R-060-2019, entitled "Procedure for requesting registration, special orders for the authorization of exemption or reduced rate of Value Added Tax (VAT)", was published in the Official Newspaper La Gaceta."
In Costa Rica, companies in the agricultural and fishing sectors will not have to use the mandatory electronic receipt system until October 2019.
The government has decided to postpone the entry into force of the electronic receipt system for these two sectors, with the aim of having more time to better implement the system and solve the problem of internet access that several producers claim to have.
In Costa Rica, the Ministry of Finance has announced that it will intensify controls on tax returns submitted by professionals in activities such as medicine, law and accounting, among others.
From a statement issued by the Ministry of Finance:
As part of the control actions carried out by the General Department of Taxation (DGT), this month a campaign was launched to monitor the professional sector which includes sending out more than 25 thousand messages.
Although Airbnb offered to collect the sales tax for transactions made in Costa Rica through its platform, the Treasury is evaluating asking the US for information on the hosts.
The Directorate General for Taxation will try to exhaust all routes first with the company Airbnb, but as a second alternative, it has announced that if it does not reach an agreement with Airbnb, it could request information on the hosts, making use of international agreements for exchange of information with other governments, such as as the US.
In Costa Rica, the Ministry of Finance is using a predictive model designed with data mining techniques to determine the behavioral patterns of companies that might be circumventing tax payments.
Analyzing and crossing checking historical information from multiple databases, the statistical model used by the Directorate General of Taxation attempts to predict which companies are more likely to evade paying taxes depending on their historical behavior measured through transactions, tax returns and other data.By linking all of the information, they identify patterns of behavior similar to those of other companies that have evaded taxes in the past.
The Directorate General of Taxation has suspended the decree that prevented agencies and distributors from importing latest model vehicles, corresponding to 2018.
The restriction on imports of 2018 models came into effect in October last year, when the Ministry of Finance issued Decree No. 39941-H.
A 15% tax, charged by the Treasury on income from interest generated on foreign investments in securities in the local market, has been described as incorrect.
A ruling by the Attorney General of the Republic indicates the charge of 15% by the Treasury on interest earned by foreigners on their investments in securities in the local stock market is incorrect and it should be 8%, as is charged to local investors.
It has been announced that from March a group of large taxpayers will have to start using the electronic billing system mandatorily.
According to the Directorate General of Taxation, they will begin with a group of companies considered large taxpayers, who have already received training to implement the use of electronic invoices starting from March.
The Directorate General of Taxation has hired an external service that cross matches taxpayer data in public databases to identify suspicious patterns that might suggest misconduct.
The project called Predictive Model started to be implemented by the Ministry of Finance of Costa Rica this year, and aims to analyze the behavior of firms and individuals in order to identify suspicious or unusual patterns in the process of declaration of income and tax payments.
A declaration of unconstitutionality has been given to the section of the tax code that allowed the Treasury to demand payment of penalties and interest allegedly owed on taxes before the right to a defense can be exercised.
The slowness and inefficiency with which the Taxation department processes tax disputes, sometimes involving decades before there is a resolution, led to the outlandish idea on the part of lawmakers of putting the cart before the horse.In order to solve the problem of stubborn evasions where people take advantage of the inefficiency of the Taxation department, a decision was made to take away from companies the right to contest the results of tax audits, forcing the taxpayer to pay the amounts ordered by these audits, within in a deadline of one month, in order to be able to initiate formal questioning of those results.Now, the Supreme Court of Costa Rica has taken away that power from the Taxation department, declaring it unconstitutional.
A bill approved in the Legislative Commission creates a register of shareholders to which the tax authority would have unrestricted access.
The main objective of the project against tax fraud is to enable the Directorate General of Taxation to seize the assets and bank accounts of taxpayers classified as delinquent, under the order of a judge.The embargoes could be extended for a period of up to two years.
Two years behind schedule, an announcement has been made that in January 2017 the electronic billing system will be implemented by Empresa de Servicios Públicos de Heredia.
From a statement issued by the Ministry of Finance in Costa Rica:
Empresa de Servicios Públicos de Heredia (ESPH), was selected by the Ministry of Finance for the development, implementation and operation of an electronic invoicing system, which will start in January 2017.ESPH together with another company which is a specialist in the subject, will be responsible for developing the software and putting into use the technology platform (networks, servers, connectivity, among other things, as well as the reception, validation and storage of electronic receipts or invoices.
A bill has been presented that aims to create a single digital window for obtaining operating licenses, social security numbers and taxpayer codes in one day.
From a statement issued by deputy Otto Guevara Guth:
Members of the Libertarian Movement caucus have presented Draft Law No. 19,913 entitled "Reform of the Municipal Code," which aims to:
1. Convert licenses or municipal permits for an economic activity within an applicant's right in order to verify that the regulatory plan supports the activity in the corresponding area.
An appeal by the private sector has been rejected and the Treasury will be able to require large taxpayers to be included in the AMPO system which contains information deemed sensitive.
From a statement issued by the Ministry of Finance:
The Ministry of Justice has finally decided in favor of the Tax Administration, in the process that the Chamber of Food Industry and several coadjuvants filed against the Scheduled Analysis Multifunctional and Target tool (AMPO).
On average in Costa Rica more than one in five companies classified as Large Taxpayers do not pay taxes.
EDITORIAL COMMENT:
When the Tax Department does not fully complete its duties, competition between companies is settled not by the quality of products or services, or for the excellence of its managerial staff and their strategic direction, but for the ability of their tax advisors to reduce the amount of taxes paid.
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