Thursday 16 September 2021

Legislators Looking To Tax Non-Traditional Lodging

Operators of platforms like Airbnb are being targeted to pay taxes to continue operating

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The proposed bill to generate security in tourism to avoid repeating what happened in the Airbnb where Carla Stefaniak stayed, where her body was found, is being discussed in the Economic Affairs Committee (Comisión de Asuntos Económicos), where taxing non-traditional lodging like Airbnbs would equalize the balance compared to hotels.

American-Venezuelan tourist Carla Stefaniak stayed her last night alive in Costa Rica in an Airbnb in the mountains of Escazu.

The Law to Regulate Non-traditional Lodging Services (Ley para Regular los Servicios de Hospedaje) proposes that operators of Airbnb and other non-traditional lodgings pay a 3% tax on their profits, in addition to the 13% sales tax.

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Thus, if the bill is approved, operators would have to pay a tax of 16% (13% for the Ministry of Finance and 3% for the Ministry of Tourism) on their rentals.

The Minister of Tourism María Amalia Revelo and Javier Pacheco, vice president of the Costa Rican Chamber of Hotels (CCH) are in favor of the tax.

However, Pacheco would like to see operators pay in addition to the 13% sales tax, a 10% services tax, a 30% tax on income, patents, social security charges, industrial rates for water and light, as well as standards of security.

Asked if tourism could be affected by the 16% tax, Pablo Heriberto Abarca, chairman of the Committee, argued that this would not happen because the rates on platforms ie. Airbnb are cheaper compared to traditional and, similarly, the impact on the consumer pocket would not be significant.

For her part, the Minister of Finance, Rocio Agular, objects to the specific destination of the tax collected, saying it is not convenient to generate specific destinations “because we ended up disarming the whole (tax) scheme”.

According to estimates, taxing this sector would raise about US$80 million per year in taxes.

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It is estimated there are about 16,000 rooms in the Costa Rica that provide this service.

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Q Costa Rica
Reports by QCR staff

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