QCOSTARICA – Costa Rica president Carlos Alvarado attributed “electoral fear” and “fear of telling the truth” to the candidates and legislators who oppose the tax projects included in the fiscal adjustment agenda agreed with the International Monetary Fund ( IMF).
That was his reaction when asked what alternatives he proposes, after the decision of Partido Liberacion Nacional (PLN) presidential candidate, José María Figueres, not to support the plans presented by the Government on taxes on luxury homes and lottery prizes.
Other political groups, such as the Partido Unidad Social Cristiana (PUSC), have expressed total opposition to the tax plans, just as the IMF’s first review of compliance with the agreements signed in January is approaching for the country to access a loan of US$1,78 billion, destined to balance public finances.
“All the candidates and I say candidates because they are the leaders of the political forces that are in Congress, they say no more taxes. Okay, so the question is no up to me; the question is up to them. What do you propose, how do you solve this? I already put my proposal, it is in the (Legislative) Assembly; I do not have the right to amend; legislators do have the right to amend.
“Recently, the legislators say‘ you have to send a replacement text ’. And the right of amendment of the legislators? Can’t you change what you don’t like? You know what I think there is, frankly? Fear, fear of telling the truth about what they have to do because of electoral fear.
“The difference between democracy and populism is in the truth and tell the truth about what you are going to do, to solve this. I already told my truth,” Alvarado declared.
On Wednesday, Figueres told La Nación that he is opposed to extending the tax on luxury homes to more homes, so he rejects the current version of the reform proposed by the Government for this tax.
Currently, the tax is charged to homes whose construction is valued at ¢133 million or more. Now, the Ministry of Finance proposes to tax from ¢108 million.
Figueres asks to leave the tax floor as it is today, but to transfer the tax collection work to the municipalities, which already collect another tax on the value of the properties: the municipal real estate tax.
At the same time, the liberationist said that the project to create a 25% tax on lottery prizes of more than ¢ 225,000 million contributes little, but it upsets the citizenry, which is why he considers it expendable.
In parallel, the legislative fraction of the PLN required the Government to present substitute texts for the projects on the PLN’s agenda and Zapote responded that, this Friday, it will deliver new versions for the initiatives for the plans to reduce tax exemptions (file 22,369) , tax on lottery prizes (22,354), tribute to luxury houses (22,382) and solidarity contribution of public companies to public debt (22,384).
These initiatives are part of a set of projects on public income and expenditure that must be fulfilled for the country to access IMF credit, which has already delivered a first tract of $ 293 million.
The other semi-annual disbursements are subject to the gradual fulfillment of the agenda.
The president also described as “pure demagoguery” the speech of the deputies who insist on qualifying the Government as “gastón”, since he alleges that the Executive has complied with the fiscal rule of cost containment.