A bill to improve the fight against tax fraud authorizes the tax authorities to seize the assets and bank accounts of delinquent taxpayers, without a warrant from a judge.
An article in Nacion.com reports that the Technical Services Department of the Legislative Assembly has proposed a rule that "... could affect property rights and the privacy of individuals because it would allow Taxation officials to take possession of any money deposited in bank accounts, income from salaries and pensions. " and all this "... without a warrant, the Tax Administration would be able to seize assets and enter business establishments."
Limiting the deduction of interest from income tax and eliminating the exemption from payment of 15% for dividend distribution between companies are part of the changes included in the project.
The Bill to Improve Anti-Tax Fraud, presented by the Ministry of Finance amends various tax issues that must be taken into consideration by companies operating under Costa Rican law.
The business sector of Costa Rica agrees with the content of the draft law proposed by the executive branch to combat tax evasion, but points to gaps in the text.
The lack of "... clear measures on how to combat informality" is one of the shortcomings of the initiative, according to Alan Saborio, coordinator of the Tax Commission of the Costa Rican Union of Chambers and Associations of Private Enterprise (Uccaep).
The Ministry of Finance is preparing a bill that would require filing an income tax statement before applying for a loan from a bank.
The purpose of this initiative against tax evasion is for the Ministry of Finance to "... have the same status as the Costa Rican Social Security Fund (CCSS), ie that people must be up to date with payments to the institution in order to make arrangements in the public sector. "
The new Solís administration plans to establish the Value Added Tax and demand proof of tax payment for procedures in public institutions and on application for bank loans.
The tax reform being prepared includes a bill to reform income tax. This is part of a project by the Ministry of Finance which includes 55 specific actions among which are changes in the area of income, reducing government spending and control of state borrowing.
The Government of Costa Rica will create a new Special Fraud Unit and has issued a directive to restrict settlements in cases of tax evasion.
A statement from the Presidential House reads:
The President of the Republic, Laura Chinchilla Miranda said that "Costa Rica has been taking steps in the right direction to improve tax administration, not only have we implemented leading-edge management models, but we have also proposed major changes to the laws of both taxes and procedures demonstrating a clear conviction and commitment by this Administration to improve public finances with a strong desire to work on the structural failure of our tax system. "
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