From the press release:
The tax plan will significantly increase income tax payments for smaller companies
The Chamber of Industries of Costa Rica has expressed its concern that in the new text of the Solidarity Tax Project, the result of a political agreement between the Government and the Citizen Action Party, significantly increases the amount that must be paid by small businesses, particularly those made in the form of legal person.
Analysis by the ICRC shows that for the fiscal year 2011, a small business with annual gross revenues are less than ¢43,253,000 will have to pay a charge of 10% on net income. For example, a small business whose gross sales or revenue are ¢42 million and has a profit or net income of 20% (¢ 8.4 million), will have to pay ¢840 000 in income tax. Now, if this company was to apply the scale contained in paragraph 2 of Article 22 of the Tax Office Solidarity Project, it would be taxed at a rate of 15% on the first ¢4 million profit and 25% on profits exceeding that amount, so the amount of tax to be paid would amount to ¢1.7 million, representing an increase in the tax burden for small business of 102%.
More on this topic
February 2011
Businessmen in Costa Rica criticized the proposal which taxes 1.5% of gross income per quarter.
According to the proposed fiscal plan, this levy would replace the current partial payments made by companies for income tax, but if at the end of the fiscal year if the amount to be paid in income taxes (profit) is less than 1.5 %, no return may be requested.
November 2011
According to the Costa Rican Chamber of Commerce goods and services and therefore consumers will be the biggest losers if the tax reform is approved.
A press release from the Chamber of Commerce of Costa Rica reads:
Goods and services in our country, and therefore consumers, will be the biggest losers if the Solidarity Tax Bill is approved, due to fixation of new value-added tax, which will increase prices.
January 2011
Summary of the legal tax reform aiming at increasing tax revenue by $ 1.000 million, or 2.5% of GDP.
The so-called Solidarity Tax Bill was presented yesterday to the Legislature by the Executive Branch.
The initiative seeks to increase tax revenues by 2.5% of gross domestic product (GDP) which, coupled with the implementation of measures to increase revenue and reduce spending, would balance the public budget.
March 2012
Already approved in the first instance, the draft Law on the Solidarity Tax involves substantial changes which will in general raise taxes on productive and commercial activities.
An article in Elfinanciero.com.cr reviews the main consequences of the adoption of the fiscal plan.
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