By Wendy Anders

Costa Rican President Luis Guillermo Solís signed a new law designed to fight tax fraud on December 19, 2016 that will affect owners who rent properties for less than a month at a time, said tax officials this week.

Officials reminded owners of various residences, cabins and other lodgings offered on sites such as AirBnB for short-term rental that they are required to pay Costa Rican income and sales tax just as a hotels.

Gustavo Araya, president of the Costa Rican Chamber of Hotels, said this is allowing for “free competition but under the same conditions.” And said that residents of condominiums and other sites are encouraged to report suspicions of any anomalies in tax reporting of below-board rentals by their neighbors to tax authorities.

“People who rent real estate for residential use for periods of less than one month (transient residences, boarding houses, cabins, camps, among others),” says a statement from the tax administration, “must register through the TribuNet system as taxpayers using the economic activity code 551001.”

In mid-2016, owners of the U.S. company, which connects guests and hosts through a web platform or mobile application, approached Hacienda to show their willingness to pay taxes in the country, said a report on AmeliaRueda.com, an online Spanish-language media in Costa Rica.

Airbnb was founded in August 2008 in San Francisco, California. It currently operates in more than 34,000 cities in 191 countries around the world and has facilitated hosting of more than 60 million tourists, according to their website.