A new tax reform bill is bringing up for discussion which sectors of the economy need these stimuli kept in place and which do not.

The bill on a new tax reforms seeks to incorporate new control measures for public expenditure and to implement changes to the tax system.

With the new reform, the country’s tax burden would rise from the current 13.7% to 15.5% of production and could grow to 19% in cases where social charges are added. In addition it is expected that state expenditures will be reduced by 1% of GDP and revenues increased by 2%.

All of the tax exemptions in the country granted to various sectors of the Costa Rican economy will be on the table in the formulation of the new bill to reform the IRS, said Alvaro Ramos, vice minister in charge of revenue and leader of the process, according to an article in El Financiero.

Some of the benefits given to economic activities have been in force for over 30 years.

“It is time to assess whether these stimuli need to be maintained. Some could be simplified or reduced. For example, the exemptions that apply to the cooperative sector could be activated only for enterprises qualifying as a small businesses,” said the ex-assessor of Finance, Fernando Rodriguez.

Source: ElFinancieroCR.com