Costa Rican congress approved a new law to attract investors, people with fixed income (rentistas) and retirees; the purpose of this law is to offer temporary benefits for people who wish to come live in the country and apply for the residency under any of the categories mentioned.

Although it was already possible to apply for the residency under those categories now there are additional benefits offered with the purpose of reactivating the country’s economy, deeply affected by the COVID-19 pandemic.

Some of these incentives include:

Investors: for a period of 5 years there is a new investment amount established at no less than $150 thousand dollars that can include: assets or property, stocks, investment bills, productive projects, or projects of national interest.  The amount previously established for this category was of $200 thousand dollars.

The new law also expands to include investments related to science or investment funds as well as projects related to sustainable tourism and venture capital funds.

The amounts declared as income to become a creditor to the benefits of this law will be exempt from income tax. However, the rent obtained in Costa Rica because of the investments made will be subject to income tax.

For all categories: During an established term and as a onetime benefit, applicants can request a tax exemption on the import of household goods for the main applicant and their immediate family as well as tax exemption on the import of up to 2 vehicles for personal or family use.

Exoneration of 20% of the total transfer tax for real estate transactions that are carried out within the time range established by this law, as long as the beneficiary is the registered owner of the property. In the event that the owner then decides to sell or transfer the property to someone else before the term established by law the taxes will be applied.

This law also hopes to simplify the process to opt for a residency under these categories.

This new law has caused different opinions within the government since the bill was voted in congress without first consulting with the Ministry of Hacienda (Treasury) or other institutions such as the Costa Rican Drug Institute which has raised the flag about the possibility of also attracting funds of unlawful activities.