Costa Rican business tax would help boost security

December 8, 2010

The proposal would tax “Sociedades Anónimas” (S.A.), or corporations, $200 a year if passed by the full Legislative Assembly. The bill received unanimous approval by members of the finance committee this week.

According to lawmakers, the tax would be applied to all businesses or individuals who have a registered S.A. – the tax structure required to do business in Costa Rica – with the goal of raising $102 million for public security initiatives.

The proposed tax would not affect small- and mid-sized businesses that are registered with the Economy Ministry.

Alan Soborío, a former government tax official, said S.A.’s have been used in the past to avoid paying taxes on the purchase of cars or homes, which was not the tax structure’s original intent.

According to Finance Committee President Guillermo Zúñiga, the tax would also aim to streamline the country’s bulging files of S.A.’s, giving officials the ability to throw out papers for defunct or non-operational businesses. 

“Not only will it help us clean the registry of S.A.’s … but it will also give the country greater resources to confront the serious problems of insecurity that we face,” Zúñiga said in a statement.

The bill now goes to the floor of the Legislative Assembly for debate.

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