Debt to Municipalities Could Repair Roads

November 12, 2004

IF residents paid their property taxes,trash-collection fees and other debts theyowe to the municipalities in which theylive, their roads would be smoother, theirsidewalks safer and their water servicebetter, according to a report in the dailyLa Nación.The report cites calculations by theComptroller General that residents owe¢26 billion ($58 million) to 75 of the 81cantons in the country, primarily for latepayment of property taxes.This money – twice the amount themunicipalities claim they need from theFinance Ministry for road repair – wouldallow for sidewalk construction, roadrepair, scholarships, increased landfillsand other infrastructure, according to thereport.This year, the ministry was supposedto provide ¢11.3 billion ($25 million) forroad repair, but turned over only 10% ofthat for the maintenance of the 28,500kilometers of Costa Rican roads.The Constitutional Chamber of theSupreme Court (Sala IV) ruled earlier thisyear the ministry must turn over some ofthese funds, collected from a special gastax specifically collected for road repair(TT, Oct. 15).Some representatives of the municipalitiesclaim the Comptroller General’sestimate of uncollected taxes is not correct,and estimate the amount of delayedpayments between ¢13 billion ($29 million)and ¢18 billion ($40 million),according to La Nación.The representatives told the daily thatmany payments considered delayed canactually never be paid, because they comefrom dead debtors or closed businesses.However, they recognize the countrylacks a tax culture and many people donot like to pay.Some municipalities have used publicitycampaigns and collection agenciesto improve collection of debts.

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