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The VAT and UBER

Rico's TICO BULL - "We remain committed to the country," reads the headline of the email Uber sent its customers on Monday, July 1, with the start of the Value Added Tax (VAT) or Impuesto de Valor Agregado (IVA) in Spanish. "At Uber, we consider...

The VAT is not the end of the world

Each home is different. However, the entry of the Value Added Tax (VAT) will represent an additional cost, which can mean an increase in running the family home. A strong change will be that of residential rents greater than c670,000 colones monthly, since the 13%...

Three Month Moratorium On VAT Sanctions

The Ministerio de Hacienda (Treasury) announced on Friday a three-month moratorium on "sanctions, arrears, interest, fines or any other sanctioning provision" regarding the Value Added Tax (VAT). This means, though the new tax regimen goes into effect on Monday, July 1, fines won't be applied...

Exporters in trouble for VAT will get an extension

The permit that the exporters have to buy without the Value Added Tax (VAT) that goes into force on Monday, July 1, will be extended, in some cases up to six months, while they adapt to the new requirements, according to Priscilla Piedra, general...

Violence At Casa Presidencial: Protestors Throw Stones And Dynamite

A noise inside the Casa Presidencial (Government House) House building alerted the police on Tuesday, locking down the building as the protests by fishermen outside the gates turned violent. The alarm went off, the main glass doors to the building closed and police dressed in...

ATV and TICA Systems will be out of service this weekend

The Ministry of Finance (Ministerio de Hacienda) said ti will suspend this weekend the ATV (Virtual Tax Administration) and the TICA (Information Technology for Customs Control) to make available to taxpayers new forms to be used, starting July 1, with the entry into force...

Squeezing Out Every Single Last Colon

In the caricature we see the Ministra de Hacienda (Minister of Finance), Rocio Aguilar, squeezing all she can from "tico mae". It will sure feel that way in a few days, when the current sales tax is replied by the value-added-tax or VAT (impuesto al...

“Costa Rica would lose tourism competitiveness due to new requirements”, business sector

A charge of US$15 to tourists who want to enter Costa Rica, as proposed by a bill, would reduce competitiveness to the country as a destination, according to tourism entrepreneurs. "This is not the most opportune moment to try to impose a new burden on...

Costa Rica is on the verge of adopting one of its biggest changes in taxes

Starting July 1, 2019, the economic life of Costa Rican households and businesses will face changes. On this day, Costa Rica launches the Value Added Tax (VAT) - Impuesto al Valor Agregado (IVA) in Spanish. On this day important tax reforms will go into effect,...

Hard blow to tourism in Costa Rica

Two aspects included in the Plan Fiscal (tax reform) would hit tourism, making services more expensive and, thus, the cost of vacationing in Costa Rica. A contraction of the national tourism and a reduction of competitiveness as a destination country before other markets in the...

Getting married (and even divorcing) will be more expensive on July 1

If you are planning on getting married (or divorcing), celebrating a birthday party, anniversary or any other type of celebration, be ready to pay more starting on July 1 when the Value Added Tax (VAT) - Impuesto al Valor Agregado (IVA) in Spanish) -...

Starting July 1 all services will be taxed with 13% VAT

Starting July 1 all services will be taxed with 13% Value Added Tax (VAT) - Impuesto al Valor Agregado (IVA) in Spanish. For this, the Ministerio de Hacienda (Ministry of Finance) has prepared a "campaña informativa" (information campaign) ahead of the change in the tax...

The ‘Netflix Tax’ Will NOT Start On July 1; Amazon To Be Excluded From The VAT

Services such as Uber, Airbnb, and Netflix, among others,  will continue without the 13% Value Added Tax (VAT), according to a report by La Republica, at least while the Ministerio de Hacienda (Ministry of Finance) defines the list of companies to which the tax...

According to proposal, Airbnb would pay 13% VAT

According to PLN legisaltor Roberto Thompson, it is almost a fact that the Airbnb in Costa Rica will pay the 13% Value Added Tax (VAT) that goes into effect on July 1. The legislator commented that the legislative bill is on track and that in...

Consensus coming closer on taxing digital economy

(BNamericas) Nearly 130 countries have agreed on a global roadmap proposed by the Organisation for Economic Co-operation and Development (OECD), which could lead to an international consensus to level out the taxation of internet giants by the end of 2020. The 129 members of OECD’s...

350 businesses closed in San Carlos in the last 12 months

According to the local Chamber of Commerce, 350 businesses closed their doors in the canton of San Carlos, Alajuela, 150 in Ciudad Quesada alone, in the past 12 months. Marco Solis, president of the organization explained that the economic situation the country is going through,...

High Consumers Of Electricity and Water Would Pay The VAT

On July 1, the current sales tax (impuesto de ventas in Spanish) will be transformed into the new Value Added Tax - VAT (impuesto al valor agregado - IVA, in Spanish) that will begin taxing services including utilities such as water and electricity. The VAT...

Costa Rica Consumers Will Have To Pay The VAT On Cross-border Services

Sounds like something very technological. The words 'cross-border services' (servicios transfronterizos in Spanish) in the coming weeks will begin to impact the pockets of consumers in Costa Rica. 'Servicios transfronterizos' is the category by tax authorities that includes services such as Uber, Spotify, YouTube Premium,...

Government refuses to charge VAT on Uber trips

As of July 1, Uber users will pay a 13% Value Added Tax (VAT) for each of their trips, as the company plans to collect the tax even though the taxman says it will not collect it from the company until the activity is...

Construction will become more expensive with tax reform

With the entry into force of the Value Added Tax (VAT) - Impuesto al Valor Agregado (IVA) in Spanish -, all services necessary to complete a construction process will increase by having to charge a tax of 13% on the invoices issued. This is a...

Legislators Approve Plan Fiscal, President Signs Into Law

Legislators on Monday afternoon approved in second and final debate the Plan Fiscal - Ley de Fortalecimiento de las Finanzas Públicas - with the aim of alleviating the country's fiscal deficit. The Tax Reform bill was approved with the votes of 34 votes in favor...

#DontBeFooled: Tax reform does not include charging VAT for purchases made abroad

#DontBeFooled. False are the reports that the  Value Added Tax (VAT) - Impuesto Sobre el Valor Agregado (IVA) in Spanish - applies to purchase made outside of Costa Rica. False is also the reports that purchases made outside of the country with cards issued...

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...

Another Try! Government Sends Legislators New Draft Tax Reform

In an effort to keep alive the reforms to the Plan Fiscal (Tax Reforms), the government of Carlos Alvarado delivered to the legislative caucuses a new substitute text, which includes changes in the articles on the Value Added Tax (VAT), income tax and unemployment...

Tax Reforms To Suffer New Impasse

Today, Monday, the tax reform bill "Ley de Fortalecimiento de las finanzas públicas' will suffer a new impasse: a pause in the legislative process to make way for the new Legislative Assembly that forms on May 1. On April 30, the current crop of legislators...

Netflix Yes, Amazon No With Respect To The VAT

The Ministerio de Hacienda (Ministry of Finance) explained on Friday that the proposed 13% Value Added Tax (VAT) on goods on services being processed through Congress that includes taxing online purchases would be applied to Netflix, but not to Amazon. Hacienda explained that the tax...

Uber Trips Would Be Taxed If VAT Is Approved

Legal or not, the tax plan that is in the process in Congress,  if approved, would have users of Uber pay the Value Added Tax (VAT) on their trips. The VAT on Uber trips would be 13%. According to Priscilla Piedra, the general director of Hacienda...

Internet Purchases Would Pay Double Tax, If Proposed Tax Reform Approved

Purchases made online in Costa Rica would have two types of taxes, if the current text of the Ley de Fortalecimiento de las Finanzas Públicas (tax reform bill), making its way to the legislative process is approved after reaching the full Legislative Assembly on...

President-elect Alvarado Faces Biggest Deficit In Three Decades

The challenge facing the next government led by President-elect Carlos Alvarado, is a Costa Rica economy facing its biggest fiscal deficit in 30 years, when more than one-third of the central government's debt is due and without many instruments to finance it, with permission...

One Step Closer to a Tax Reform

The Costa Rican Legislature has accepted a fast track bill that would transform the 13% sales tax into a Value Added Tax (VAT) and in addition a 4% rate on the purchase of packaging, wrapping and raw materials, among other things. The Impuesto al Valor...

Government Proposes To Charge 4% VAT Tax On Airline Tickets, Books and Machinery

Expected today, Thursday, is the government's final draft of its tax reform that establishes two Value Added Tax (VAT) rates -  Impuesto Sobre el Valor Agregado (IVA) in Spanish - one 13% and the other 4%, with the aim of alleviating the deterioration of the...

End of Real Estate…….

The Legislative Assembly, our answer to Congress, is looking favorably and closely to charging renters a 13% tax on rental housing in Costa Rica, as part of the plan to move the country from a sales tax (currently 13%) to a value added tax...

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