Costa Rica News – The Costa Rican government is trying to get money anyway they can and as we all know getting money back from any government is a long and tedious process.
The Ministry of Hacienda has its work cut out. It needs to change a plan to charge value added tax (VAT) on all purchases abroad. This is because the current plan makes almost no sense at all.
As is, the plan is that all goods and services paid for abroad with a Costa Rican card will be taxed 13%. This poses so many problems. First, if someone buys a pair of shoes online they would have to pay the tax at the time of purchase as well as in customs and then go to request a refund for the double charge. If someone travels abroad, the tax is charged but doesn’t apply. They would be charged for every purchase, every hotel stay, every restaurant and then have to return to Costa Rica to claim refunds.
The Ministry of Finance, along with banks, are looking for a solution as these problems function as disincentives to use the cards. Some adjustments will have to be made. One option is that perhaps one could show proof of paying the tax when they go to customs so as not to pay it twice.
Another option is to separate out the “cross-border services,” such as Uber and Netflix that the Government wants to tax, instead of taxing everything and then giving refunds.