Costa Rica News – After two meetings and much dialogue on tax reform, today the Government released a new version of the Law of Strengthening Public Finance. Various changes have been introduced at the request of legislative fractions.
Main changes to the new version of the tax plan include lower value added taxes (VAT) on private education, medicines electricity and rentals for micro, small and medium enterprises. The VAT would be lowered from 4% to 2%.
To compensate for the VAT reductions, the new plan adds 2% tax to the import or local purchase of wheat, soybeans, sorghum, corn, fruit and palm kernel oil. Also taxed an additional 2% would be insurance premiums and the purchase of packaging.
The initial maximum ceiling of deductions companies can make for operating expenses will be 30% and will be gradually lowered until reaching 20%.
The new motion with substituted text was circulated among congressmen.