Tuesday, 27 October 2020

Costa Rica’s Taxman Faces A Challenge With Foreigners With Foreign Payment Options

Rico’s TICO BULL  The current government, as its three predecessors, is intent on introducing sweeping tax reforms that include the introduction of a Value Added Tax (VAT) or Impuesto al Valor Agregado (IVA) in Spanish, that proposes to tax many items not taxed under the simple Impuesto de Ventas (IV) or Sales Tax currently applied to consumer purchases.

Sit bakc, enjoy, mostly like the IVA, if and when it is implemented, won’t apply to your Netflix if you don’t make payment using Costa Rica plastic.

One of the items that would be taxed IF and when the IVA is approved and goes into effect is Netflix.

- Advertisement -

That is, for the current monthly Netflix of $10.99 (¢6,300 colones), the cost would be US$12.41 with the 13% tax, if payment is processed in Costa Rica.

To collect the tax, the law would require issuers of credit and debit cards to collect the tax when processing the payment.

But what of payments made on cards or other online payments gateways with no connection to Costa Rica payment options such as credit/debit cards issued in the U.S., Canada, Europe, Paypal, Payoneer, Paxum, etc.?

That is, the tax on your Netflix or digital services such as hosting for websites, domain registration, antivirus, etc, would only apply if you made payment using a credit/debit card issued in Costa Rica.

- Advertisement -

Hopefully, the short arm of the Tico tax man won’t reach far enough to tax us foreigners who call Costa Rica home, outside the borders.

Again, not charged on a Costa Rica card means no IVA.

Maybe. In Costa Rica, everything is a maybe. Even maybe itself.


Use the comment section below or comment on our official Facebook page. I would like to hear your opinion on this.

- Advertisement -
Ricohttp://www.theqmedia.com
"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

Related Articles

‘Someone has to die’: Netflix portrays racism and the persecution of homosexuality in 1950

Q ENTERTAINMENT - Someone Has to Die (Spanish: Alguien Tiene Que...

Staying at home costs 13% more!

On October 1, the 13% Value Added Tax (Impuesto a Valor...

MOST READ

COVID-19 in Costa Rica: 1,372 new cases and 30 deaths for Sunday and Monday

QCOSTARICA - The report Monday by the Ministry of Health detailed 1,372 new cases for 48 hours from Saturday to Monday, for a total...

Distrust of sectors complicate signing an agreement with the IMF this year

QCOSTARICA - Reaching a structural adjustment agreement with the International Monetary Fund (IMF) this year seems like an impossible mission for President Carlos Alvarado,...

Reduction of working hours for private sector would be extended for six more months

QCOSTARICA - With the objective of avoiding massive layoffs and more labor lawsuits, private sector workers who are working only part-time today due to...

Reinas join OIJ to help women who suffer physical and sexual violence

QCOSTARICA - A few months ago, after being in an intense self-defense class, the partners, friends and beauty queens María Teresa Rodríguez (Miss Costa...

Reduction in Marchamo pending

It is expected that this Tuesday, October 27, Congress will approve the reduction in the 2021 Marchamo.

Agreement between legislators: marchamo would drop only for vehicles of less than ¢15 million

QCOSTARICA - Legislators from different political parties reached an agreement on Monday, October 26, to reduce the property tax portion of the 2021 Marchamo,...

Let's Keep This Going!

To be updated with all the latest news and information about Costa Rica and Latin America.

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.