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Friday, June 12, 2020 in exchange for more tax wages By the A.M. Costa Rica staff On Thursday, the Government presented to Congress a new bill to exempt the value-added tax, known as IVA, to all the products and services of the basic food basket. The basic food basket, know as Canasta Básica, is a group of products and services considered to be essential for basic living. It includes utilities such as electricity, water and food such as rice and beans among many others. The goal is to reduce the effects of the economic crisis that covid-19 has caused on the population, mainly people in the most vulnerable sectors, the government said in its statement. In case the deputies approve the bill, the products and services listed in the basic food basket would be exempt from taxes for one year, from July 2020 to July 2021. To compensate for the decrease in income to the government, by not receiving the payment of taxes, a project was also presented to tax the extra bonus received by the public employees, known as Salario Escolar, or School Salary. The school salary or extra bonus is equivalent to one month of salary paid to the public employee in January, days before the start of the school year. The goal of this benefit is to help families pay for their children's school supplies or to help employees pay for expenses in the case they are studying. The money is paid to all public employees regardless of whether they have children or school. According to the government, the school salary extra bonus tax would be applied in the same conditions in which income taxes are now collected on wages. This is the second sales tax could be suspended, announced the Congress this week.  On Wednesday, the deputies of the Economic Affairs Commission approved the analysis of the bill No.21934, which proposes to suspend the mandatory entry payment of the Value Added Tax, IVA, for the tourism sector until 2021. According to Congress, the bill proposes to extend the grace period for two years in the Public Finance Strengthening Law regarding the entry into force of the collection of the IVA tax on the tourism sector. The current law requires tourist entrepreneurs to collect a 4% VAT tax from July 1. In 2021 the tax will rise to 8 percent. Starting 2022 the tax will rise to 13 percent. This temporary suspension of the tax will not have a direct impact on the finances of the Ministry of Finance, said the deputy Roberto Thompson who presented the project in Congress. After this approval, bill No.21934 will be presented to the deputies for the first round of voting. After two rounds of voting, Congress will determine the approval or rejection of the bill. The Chamber of Tourism celebrated the progress in the bill that could suspend the VAT tax. "We hope to have the support of the rest of the deputies," said Rubén Acón, president of the Chamber. ------------------------ Should the government create more taxes during the economic crisis caused by the pandemic? We would like to know your thoughts on this story. Send your comments to news@amcostarica.com |
