New decree voids sales tax on national park entries

Costa Rica’s tourism operators can breath easier because President Luís Guillermo Solís rejected a much-feared sales tax.

President Solís and Edgar Gutiérrez Espeleta, the environmental minister, have signed off quietly on a decree suspending an April 30 measure that imposed the 13 percent levy. The sales tax added an additional amount to admissions to national parks and protected land entrances, according to the environmental ministry. The measure also extended the tax to tourism activities within these areas.

The environmental ministry Wednesday provided a copy of the new decree that says it was prepared late last week. It does not appear to have been published yet in the La Gaceta official newspaper.

The sales tax measure was one of the last actions of the Laura Chinchilla administration. The thrust of the Chinchilla decree that appeared in the La Gaceta April 30 listed increased admission fees to national parks and other protected areas. Then in a single short paragraph at the end of the lengthy decree the new fees are made subject to the country’s existing sales tax.

The new decree by Solís and Gutiérrez voids that paragraph and also seems to reduce some of the admission fees.

Costa Rica’s finance ministry wanted the tax and cited the 1982 general sales tax law that mentions recreational centers as being subject to sales taxes.

The ministry widened the interpretation of that article by applying the tax to tour groups or individuals for activities like hiking, canopy, and rafting with the implication that they were benefiting from public lands and must pay extra.

Still unclear is if the new decree will reverse that interpretation.

Area tourism leaders worried that the higher prices would deter foreigners from vacationing in the country or at least from passing through the public conservation areas. Pablo Heriberto Abarca, the president of the Cámera Nacional de Turismo, said that the decree was unconstitutional.

Vocal support from lawmakers added to the outcry from the tourist industry. Legislators met at the end of July to call Solís’ attention to the measure they said could cripple Costa Rica’s tourism.

The new tax began by July 30 before the president’s intervention. Theoretically the tax still should be collected until the new decree is published.

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