[dailyarchive/2005_01/exchange_rates.htm]
Daily Edition: San José, Costa Rica, January 25, 2005
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Comptroller's Office Suspends
Tourism Tax Breaks
A lengthy tax battle between the Costa Rican Tourism Institute (ICT) and the Comptroller's Office took a turn against tourism industry as the institute was forced to rescind exemptions that have traditionally been granted to car-rental companies, hotels and other tourism-related businesses.
(Click for more)
British Citizen Accused of Fraud
Found Guilty and Released
British citizen John Shimell was found guilty Friday of fraud, but hours after a Costa Rican court announced the decision, he was released from San Sebastián prison, south of San José.
(Click for more)
Two Quakes Rattle Country
One earthquake struck in the north, and a second in the central Pacific coast yesterday morning, rattling furniture and jiggling things on shelves from the northwestern province of Guanacaste to the Southern Zone.
(Click for more)
January 25
Origami Lessons
For kids ages 8-12 and parents, today and Jan. 27, 10-11 a.m., at the Forms, Spaces and Sounds Museum in east San José. Info: 256-1281, 222-9462, 223-4173.
Jane Goldman Art Exhibition
“Lyrical Realism” exhibit, watercolors and engravings, through Feb. 24, Sophia Wanamaker Gallery, Los Yoses. Info: 207-7554.
Activities for Kids
Tale Time, Tuesdays, 2 p.m.; Cartoon Shows, Thursdays, 2 p.m.; Working with Recycling Materials, Fridays, 2 p.m., free registration. Info: 250-0426.
Edited By María Gabriela Díaz
Tico Times Staff
mgdiaz@ticotimes.net
Comptroller's Office Suspends
Tourism Tax Breaks
By Katherine Stanley
Tico Times Staff
kstanley@ticotimes.net
A lengthy tax battle between the Costa Rican Tourism Institute (ICT) and the Comptroller's Office took a turn against tourism industry as the institute was forced to rescind exemptions that have traditionally been granted to car-rental companies, hotels and other tourism-related businesses.
The exemptions, which have been in place since the 1980s, allowed for the tax-free import of products such as cars for rental companies, microbuses for travel agencies, and lamps and kitchen utensils for hotels.
The order by the Comptroller's Office to suspend these tax breaks could have significant consequences for the industry, according to private-sector leaders.
“We're astonished and annoyed,” Ana Gabriela Alfaro, executive director of the Costa Rican Chamber of Hotels, told The Tico Times yesterday. She said the Comptroller's handling of the decision is “almost perverse.”
“Many hotels would have to close” if the decision is not altered, Alfaro added. “Prices for the consumer would go up. The quality of tourist services would decrease.”
“This decision paralyzes the process of improving infrastructure and the quality of national tourism services,” said Carlos Roesch, president of the Chamber of Hotels, in a statement.
“Are we Costa Ricans truly conscious of the fact that tourism is the country's largest source of income, and consequently, do we believe that we must support it?” he added.
The disagreement at the heart of the conflict is whether the Tourism Incentives Law exempts companies from taxes indefinitely, or only for a defined initial period. The ICT has argued the former interpretation, but the Comptroller's Office has chosen the latter.
Roesch said the Comptroller's recent decision is all the more surprising given that in 1999, the Constitutional Chamber of the Supreme Court (Sala IV) “concluded that the Tourism Incentives Law does not have an established time frame.”
Roesch's statement called on the Tourism Institute to consult the Ombudsman's Office for an analysis of the decision – an action the institute is already undertaking, Tourism Minister Rodrigo Castro told the daily La Nación. Castro also said the institute is analyzing whether the decision may be unconstitutional.
In 2004, approximately 1.5 million tourists visited Costa Rica, a number up nearly 20% compared to the previous year. Ensuring the sustainability of the industry requires significant improvements in infrastructure and the attraction of foreign investment – both areas the tax incentives were designed to protect.
British Citizen Accused of Fraud
Found Guilty and Released
By Rebecca Kimitch
Tico Times Staff
rkimitch@ticotimes.net
British citizen John Shimell was found guilty Friday of fraud, but hours after a Costa Rican court announced the decision, he was released from San Sebastián prison, south of San José.
The court decided that the three years Shimell had already served waiting for his trial was punishment enough. Although he faced up to 10 years in prison, Shimell, 62, was given a shorter sentence because of his age, his willingness to return from Spain to face the accusations, and the fact that some clients did receive the money they were promised under his alleged fraud.
Shimell maintains his innocence and claims he was unfairly held for nearly three years and found guilty only so the court would not have to pay him for the moral and material damage he accrued during his preventive detention in prison.
Cecilia Tristán, who according to prosecutors is a dual U.S.-Costa Rican citizen who managed Shimell's business, European Financial Services, was also charged with fraud, but absolved of all responsibility.
“I am extremely happy; there is justice in Costa Rica,” she told The Tico Times. “The past three years have been very hard for me, very painful for me and my family. I really believed in the business. I told my friends to take advantage of what he was offering. It was a big surprise to me.”
Shimell was taken into custody in early 2002 under suspicion of fraud in connection with the investment firm he owned in Costa Rica. He and Tristán were accused of offering fraudulent project financing that required clients to make an advance payment of at least $10,000, which was allegedly kept despite never providing the financing, according to prosecutor Carlos Meléndez (TT, Nov. 26, 2004).
Shimell and Tristán were accused of offering investment opportunities that promised false annual returns as high as 30%, Meléndez said.
Shimell said yesterday the business did provide such returns to some clients, and clients who did not receive these benefits had failed to comply with all the required regulations.
After Shimell returned to Costa Rica from Spain to address the accusations, he was arrested here because authorities considered him a flight risk after he made travel plans to visit his dying father – who died April 23, 2002, exactly three months after his arrest. He was placed in preventive detention, where he remained until Friday.
Shimell said the justice system imposed numerous unnecessary delays and continually lengthened his preventive detention order (TT, May 7, 2004).
He said he is considering bringing the case to the Inter-American Court of Human Rights. However Shimell's lawyer said she is happy with the decision and will not take any further legal action unless the prosecutor appeals the ruling.
After being imprisoned since Jan. 23, 2002, Shimell said yesterday he is still getting used to being free.
“It hasn't really sunk in. The first night I only slept an hour because I was in a real bed,” he told The Tico Times.
This week he is visiting doctors and dentists to be evaluated for health problems that stem from being attacked by other prisoners one year ago in San Sebastián prison, he said.
Two Quakes Rattle Country
By Robert Goodier
Tico Times Staff
rgoodier@ticotimes.net
One earthquake struck in the north, and a second in the central Pacific coast yesterday morning, rattling furniture and jiggling things on shelves from the northwestern province of Guanacaste to the Southern Zone.
The first struck in Guanacaste, 90 kilometers west of Playa Tamarindo, at 9:25 a.m. It measured 4.3 on the Richter scale with an epicenter that was 10 km deep, according to the Volcanological and Seismological Observatory of Costa Rica (OVSICORI), based at the Universidad Nacional (UNA).
The second quake struck two hours later in the central Pacific zone, 25 km southwest of Jacó Beach. It clocked in at two different magnitudes with Costa Rica's two earthquake detection agencies, OVSICORI and the National Seismological Network (RSN) at the University of Costa Rica.
It was magnitude 4.3 according to OVSICORI, and 4.9 according to RSN. Its epicenter was 22 km deep according to OVSICORI and less than 10 km deep according to RSN. The difference, scientists at each institution explained to The Tico Times yesterday, is in the location of the sensors and the interpretation of the data.
The second quake was felt in the Central Valley and the Pacific slope from the northern to the southern Pacific zones, moving objects and causing slight damage, such as dishes falling off shelves, the seismological network reported. In San José, the ground vibrated, but the quake was felt less strongly.
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