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Tourist companies will be exempt from new VAT tax during the first year
By the A.M. Costa Rica staff
The entry into force of the Law of Strengthening of Public Finances and the subsequent initiation of the collection of the Value Added Tax (VAT) have generated some doubts in the tourism sector, the companies that must pay it and the way to collect it. In accordance with the law, persons or companies that offer tourist services and are registered with the Costa Rican Tourism Institute will be exempt from VAT collection during the first year. After the first year, companies or individuals who continue to be registered with the Institute must collect this tax in a staggered manner, as follows: - The second year, as of July 1, 2020, they will charge their customers 4 percent of taxes. - The third year, as of July 1, 2021, must charge the 8 percent tax to its customers. - As of the fourth year, from July 1, 2022, they must charge the 13 percent VAT to their customers. For a person or company to be granted this tax payment moratorium, registration is open at the Institute after July 1 of this year. For more information about the application of the registration in the Institute, see the web page www.ict.go.cr or call: +506 2299-5800 Last week, as A.M. Costa Rica published on June 24, the Institute authorities rejected the new bill for an extra charge $15 to tourist. Maria Amalia Revelo, the Tourism minister, said the Institute rejects bill No.20,576, which is being studied by deputies in the Legislative Assembly, and whose goal is to charge $15 to any tourist who enters the country by land or sea. That will make prices more expensive for tourists. "We are growing in quality and quantity, the logical thing in an environment of economic reactivation, is to protect the development of tourism, an industry that generates employment and social progress," said the minister. In addition to this bill, another one is also being analyzed. That is bill No.21,152, which would force tourists to have medical insurance with Social Security (known as CCSS). According to Revelo, this bill threatens the autonomy of administration of social insurance and is also incompatible with the relation between worker-employer legal requirements, and on the other hand the concept of registration of a tourist to the Social Security system. According to the Revelo, also the Ministry of Labor is opposing this bill because the concept of Social Security was created to protect the relationship between boss and employee, and also in accordance with Article 73, second paragraph, of the Political Constitution, "insurance (referring to social insurance as protection for the worker and their family) may not be transferred or used for purposes other than social insurance." According to the statistics of the Tourism Institute, in 2018, for the first time, were registered more than three million arrivals of international tourists to the country. Between January and May of 2019, the growth of international arrivals by air was 5 percent. Most of the tourists came from Canada 11 percent; Germany 13.1 percent, Austria 6.3 percent, United States 5.9 percent; ; and the United Kingdom 5.6 percent. According to the statistics of the Central Bank, the tourism sector increased from 4.4 percent in 2012 to 6.3 percent in 2016. In addition, the tourism sector employs at least 211,213 workers. ---------------- Do you know of a person or company that has applied for registration? We would like to know your thoughts on this story. Send your comments to: news@amcostarica.com |
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