By Uglobal Staff
Costa Rica has enacted a new law to make the Central American state more attractive for foreign investors, rentiers and pensioners, announcing tax exemptions and reduced investment thresholds.
On July 5, President Carlos Alvarado signed a bill into law that was approved by the Costa Rican Congress, officially titled the Law for the Attraction of Investors, Rentiers and Pensioners.
The law states that the objective for giving incentives to wealthy foreigners is to give a boost to the Costa Rican economy, which has struggled during the pandemic.
Costa Rica reduces minimum investment amounts
The biggest incentive offered to foreign investors under the new law is that the minimum investment threshold requirement has been reduced from the previous $200,000 to $150,000. This investment can be either in real estate or securities, registerable assets, shares, profit generating projects, or projects that the Costa Rican government considers to be of national interest.
All those who enter Costa Rica as foreign investors, rentiers and retirees (and their family members) would be able to avail tax exemptions on imported household goods, which the law states include home furnishings, electrical appliances, kitchen and bathroom utensils etc.
Also, they would be exempt from paying any type of taxes on up to two vehicles, used for transport over land or sea or air. They would be also allowed to sell these vehicles whenever they want.
In addition, they would get a 20% tax exemption on the total transfer tax on any real estate they acquire in the country.
New benefits would last a decade for foreign investors
For those who require special materials for scientific or professional purposes, no tax would be imposed on that either. They would just have to satisfy the Ministry of Finance that the imported material would result in economic activity in the country.
Foreign investors would also not have to pay any tax on their global income; however, the income generated in Costa Rica would be liable to tax.
Investors, rentiers and pensioners would be able to avail the benefits granted under the law for a period of 10 years from the date they were granted to them.
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