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Costa Rica proposes law to close car import tax loophole
🇨🇷 Costa Rica /Economy & Trade

Costa Rica proposes law to close car import tax loophole

From La Nación · () Spanish

Translated from Spanish, summarized and contextualized by DistantNews.

At a glance

News Official statement New plan
  • Costa Rica's Ministry of Finance proposes a new law to close a loophole that allowed for significant tax losses on imported cars.
  • The loophole, opened by a decree, is estimated to have cost the government ¢2.455 million in potential revenue.
  • The proposed legislation aims to recover these lost taxes but does not include measures against those who exploited the loophole.

Costa Rica's Ministry of Finance is seeking to close a tax loophole that has led to substantial revenue losses on imported vehicles. The ministry estimates that closing this gap, opened by a government decree earlier in 2024, could generate an additional ¢2.455 million in tax collection.

The loophole allowed certain vehicles to enter the country with significantly undervalued customs declarations. For instance, a BMW X6 M was reportedly declared with a value of only $7,400 upon its entry into Costa Rica, a fraction of its actual market price. This practice circumvents standard import duties and taxes, directly impacting government revenue.

While the Ministry of Finance is pushing for legislative action to prevent future losses, the proposed law reportedly does not include provisions to penalize individuals or entities that took advantage of the loophole. The focus is on sealing the fiscal leak moving forward, rather than pursuing retrospective action against those who benefited from the decree.

DistantNews Editorial

Originally published by La Nación in Spanish. Translated, summarized, and contextualized by our editorial team with added local perspective. Read our editorial standards.

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