President blames carelessness for ministers’ tax evasions

President Laura Chinchilla characterizes as regrettable carelessness the evasion of local property taxes by a handful of her ministers.

Casa Presidencial issued a statement just hours after the Spanish language daily La Nación reported that some ministers had not taken the legally required step to report the value of their properties to municipal officials. Among those named is Fernando Herrero, the minister of Hacienda and the spear point of Ms. Chinchilla’s efforts to get a package of new taxes passed in the Legislature.

La Nación said Herrero and his wife failed to report the value of an Escazú home for nearly a decade. Municipal tax is assessed on the self-reported values of homeowners, but the newspaper used established land values to make comparisons between what was on the books and actual value.

The statement said that the president asked her minsters who were not current with taxes to take immediate steps to become so. She also said that the issue of ministers evading tax should not become a smoke screen to reduce the importance and the value of her tax plan, which includes a 14 percent value-added tax to replace the current sales tax.

The president defended the ministers by saying that some of them, like the majority of Costa Ricans due to tradition, thought that the valuation of the properties was done by the municipality. The current law requires property owners to report the estimated value of their property to municipalities every five years. But the president said that there was no penalty for not doing so. Some of the ministers, like the president, have served in the legislature.

She suggested that the job of assessing the property should be done by municipalities and said she supported legislation to change the law in that direction. She also pointed out that there are several projects in the works to aid in the evaluation of properties.

In many cases the ownership was not obvious because many properties of the minsters are held in corporations, and that requires research to determine who is the human owner.

La Nación said that the president and her husband had reported values for their property that were probably accurate.

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