Tourism chamber says new tax would be big blow

The national tourism chamber finally has come out with a negative opinion on the proposed tax package. The organization, the Cámara Nacional de Turismo, said that the proposed 14 percent value added tax would be a heavy blow to tourism wholesalers who make international deals two years in advance. They would have to eat the tax, the chamber said.

In addition, by taxing services like car rentals, tour operators and guides the country runs the risk of being uncompetitive with other tourism destinations, the chamber said.

Fernando Herrero, the minister of Hacienda who is pushing the tax plan through the Asamblea Legislativa, gave an off-hand comment a week ago in which he said tourism operators would not face the new tax. But so far there has been no additional information or changes to reflect this view in the proposed tax bill.

The chamber said it would come up with a
proposal of its own to present to central government officials

“The official planning of this bill assumes and supposes that the final consumer, who in our case is the national and international tourist, would be disposed to assume an increase in the prices that the tourism sector would carry with the value-added tax, which is not certain.” said Juan Carlos Ramos, president of the chamber, adding:

“In an industry so competitive and feeling the effects of the 2008 economic recession, the increases are very risky for which the providers, especially those at the end of the tax chain, will have to absorb the cost of the increase . . . .“

Costa Rica is listed as an expensive destination, said the chamber, adding that increases in prices via the new tax may cause travelers to visit other countries.

Many of the tourism operators are small businesses that cannot withstand a strong economic blow, said the chamber.

This entry was posted in Costa Rica News. Bookmark the permalink.