Posted Nov 2018
According to Costa Rica’s Treasury Department, the owners of more than 2.3 million vehicles will pay an average of 7.76% less for vehicle ownership tax in the annual vehicle license collection for 2019. It is expected that a total of ¢175 billion colones be collected with this tax.
Starting November 1st, the Treasury Department made available to the public the “Self-management” (“Autogestión”) application, under the Most Used Services (“Servicios más utilizados”) section of its website, www.hacienda.go.cr, to facilitate the search of the vehicle and property’s fiscal value (not the annual vehicle license). Just by including the license plate number on the site, the interested party will be able to obtain the fiscal value, as well as request that the fiscal value be revised.
Furthermore, on October 31st, 2018, the updated fiscal value list for vehicles, aircraft and vessels, included on the Executive Decree No. 41356-H was published under the 190 issue of La Gaceta.
To explain why the tax amount to be paid this year decreased, Mr. Carlos Vargas, Costa Rica’s Treasury General Director, informed that it was since the following three factors intervene in the established by Law Tax Administration’s valuation index’s formula to estimate the taxes to be paid:
For 2019, this resulted in a 7.76% reduction in the vehicle tax to be paid, except for new vehicles registered on 2018, which have no reference value; and motorcycles, taxis, buses and heavy load vehicles, which according to the Law no. 7088 pay a fixed amount.
Examples of taxes to be paid
|2018 Period||2019 Period||Decreased Value||Difference|
|Example # 1|
|Fiscal Value||¢12.690.000||¢11.710.00||-7.72% (average)||–|
|Example # 2|
According to the current regulations, 50% of the revenue resulting from this tax’s collection is allocated to the National Road Council (Conavi), specifically for the national highway system, and the other 50% is kept in the Government’s general fund to address different budgetary programs, such as education, security, housing and public works.
The last day to pay the annual vehicle license tax without any fines will be on December 31st, 2018, therefore anyone who fails to comply with this obligation could have their license plates removed from his/her vehicle. Also, a penalty of 10% of the total amount due plus interests must be paid for each month of delayed payment.
Costa Rica’s Treasury Director reminded the public that vehicles’ ownership tax, administered by the Treasury Department, which is only one of the components of the annual vehicle license (marchamo), charged by the National Insurance Institute (INS), should also be paid along with these other components.
Although the start date for the annual vehicle license’ payment was set for November 1st, 2018, at this time is still unknown when it will start, due to a dispute between the INS and the General Insurance Superintendence (Sugese) regarding the tariffs applicable for this year.
Vehicle Ownership Tax*
Rates for 2019
|Up to ¢ 290,000.00||¢ 26,800.00|
|Over the excess of ¢ 290,000.00 and up to ¢ 1,130,000.00||1.2%|
|Over the excess of ¢ 1,130,000.00 and up to ¢ 2,230,000.00||1.5%|
|Over the excess of ¢ 2,230,000.00 and up to ¢ 3,370,000.00||2.0%|
|Over the excess of ¢ 3,370,000.00 and up to ¢ 4,200,000.00||2.5%|
|Over the excess of ¢ 4,200,000.00 and up to ¢ 5,040,000.00||3.0%|
|Over the excess of ¢ 5,040,000.00||3.5%|
*Source: Costa Rica’s Treasury Department
We hope this information to be helpful. Please feel free to reach us with questions or comments.
This article was written by Gloriana Fajardo, senior attorney at Outlier Legal Services.