Thursday 30 November 2023

Airbnb and others must apply 13% VAT starting November

Airbnb, HomeAway, and Vrbo will be part of the list of cross-border digital services to which the 13% rate corresponding to the Value Added Tax (VAT) will be applied starting November 1, 2022

Paying the bills


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29 November 2023 - At The Banks - Source: BCCR

Paying the bills


QCOSTARICA – The Ministry of Finance (Ministerio de Hacienda) announced an update of the list of cross-border services that pay 13% Impuesto al Valor Agregado (IVA) –  Value Added Tax (VAT), starting on November 1.

Digital platforms Airbnb, Homeaway, and Vrbo offering accommodation services through the internet and are widely used by tourists from all over the world, will be including the tax. Also on the list are Uber, Didi, Netflix, Disney+, among others.

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The complete list of services subject to the VAT. (Courtesy: Ministry of Finance)

The Ministry of Finance reported on Monday (October 24), that it has already published the new list, in the there are 136, with the names of the cross-border services taxed at 13%.

Hacienda noted that the decision is part of the actions to improve tax collection.

Cross-border digital services are those provided by a non-resident provider in Costa Rica through the internet or any other digital platform and that are consumed in Costa Rica.

“These new services are added to the exhaustive list prepared for Costa Rican banking entities to collect the 13% VAT on cross-border digital services,” says a press release sent by the Treasury.

These new services are added to the restrictive list prepared for Costa Rican banking entities to collect 13% VAT on cross-border digital services, in compliance with applicable legislation.

In accordance with article 17 of resolution DGT-R-013-2020, the tax administration is empowered to include or exclude suppliers or intermediaries by simply publishing the updated list on its website.

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The updated list is published on the Ministry of Finance website in the Información Tributaria/Listados de Interés/Lista de Proveedores y/o intermediarios de servicios transfronterizo.

During the first seven months of application of the Value Added Tax (VAT) to cross-border digital services, the Ministry of Finance collected ¢11.4 billion colones, a little more than 0.03% of the Gross Domestic Product (GDP).


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Paying the bills
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