Saturday, 24 October 2020

Why would it be negative to establish a tax on bank transactions?

(QCOSTARICA) Passing new taxes proposed by the government of Carlos Alvarado on bank transactions would make goods and services more expensive and companies’ payroll would increase.

“A new tax in the current situation is undoubtedly a blow for Costa Ricans and a setback in the banking process that financial entities have promoted for years,” said Mario Gómez Legal Advisor of the Asociación Bancaria Costarricense (ABC) – Costa Rican Banking Association.

- Advertisement -

According to the ABC, there would be negative consequences of the tax:

  • Disincentives saving and motivates people to use cash, that is, favors unbanking
  • Over time, people and companies learn to avoid paying the tax
  • The use of more cash puts citizens at risk from criminals
  • Generates capital flight to accounts abroad (offshore)
  • It leads to growth in the informal sector, which ends up also damaging the Caja
  • Depending on how the tax is raised, it could have a cascading impact on production costs and prices to the final consumer.
  • The World Bank has established in various studies that the use of credit or debit cards not only reduces the cost associated with the use of cash by almost 50%, but they also become mechanisms that facilitate financial inclusion, therefore a project of this nature undoubtedly goes against these recommendations

Economists, businessmen and legislators warn the Government of the dangers of including aspects such as world income or taxes on banking transactions in the negotiations with the International Monetary Fund (IMF).

- Advertisement -
Q Costa Rica
Q Costa Rica
Reports by QCR staff

Related Articles

Government withdraws IMF proposal and calls for dialogue to balance it

QCOSTARICA - Costa Rica President Carlos Alvarado announced on national television...

Bankers Oppose Lifting of Bank Secrecy

The Costa Rican Banking Association expressed its opposition to the proposal...


Global Ideas ‘Climate change is making us stronger’ — Resilient Bolivian women adapt to global warming

Nestled in Bolivia's Cochabamba valley is the village of Tiraque. One of dozens of indigenous farming communities in the traditionally fertile local region, it...

Exercise their powers effectively and with a sense of urgency

"Exercise their powers effectively and with a sense of urgency"

Legislator: “There is no prostitution anymore because there is no tourism”

QCOSTARICA - In the middle of the discussion about the project to revive trawling on Thursday, independent legislator Zoila Rosa Volio was very critical...

COVID-19 in Costa Rica; 1,210 cases for Friday, Oct 23;

QCOSTARICA - As of Friday, October 23, the country registered 1,210 new cases of COVID-19, of which 313 are by epidemiological link and 897...

Political parties turn their back on Government’s second attempt at dialogue

QCOSTARICA - The second attempt at dialogue by the Executive Power to define the route to follow in search of a solution to the...

Costa Rica eliminates covid-19 testing requirement for travelers

QCOSTARICA  - Starting Monday, October 26, tourists, residents and nationals arriving by air in Costa Rica no longer require a negative RT-PCR test. Neither will...

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.