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The latest news this week 28th August 2007 regarding the agreement between the Ministerio de Hacienda and the Movimiento Libertario is that “if” this new property tax law is implemented as is, the new Costa Rica property tax scale will affect all homes that are worth a minimum of c100,000,000 Costa Rica colones which at today’s rate 29th August 2007 of 515.70 is US$193,911.

The orginal proposal was to tax the combined value of the land and also the home on that land, now they are not including the land but are referring to the total construction which would include swimming pool and BBQ area.

According to the diputado Carlos Gutierrez, the idea all along is to increase the charge for luxury homes without “damage to the the middle class.”

Should this proposal become law, the following property tax scale will apply

1. 100,000,000 – 750,000,000 colones will pay 0.25% in property taxes
   US$193,911 – US$1,454,333
2. 750,000,000 – 1,250,000,000 colones will pay 0.35% in property taxes
   US$1,454,333 – US$2,423,889
3. 1,250,000,000 – 1,750,000,000 colones will pay 0.45% in property taxes
   US$2,423,889 – US$3,393,445
4. More than 1,750,000,000 colones will pay 0.55% in property taxes
   US$3,393,445

You can see a FREE video interview with Attorney Roger Petersen about Costa Rica Property Taxes here.

To rent or buy this 54 minute video with Costa Rica Attorney Roger Petersen please visit our Video On Demand page here.

What’s The Bottom Line?

For the vast majority of us, Costa Rica property taxes will remain the same incredibly low .25%. It’s only when you own a home worth more than US$1,454,333 will you pay more property taxes that we are paying today.

I have stated before that it would have been better to double the property taxes on all homes worth $250K or more, yes! That would affect most of us personally but we would still be paying far less in property taxes than most developed nations.

This would not “damage” the Costa Rica middle class and would generate far more, much needed revenue for the Costa Rica government than this proposal.

Randall Zamora’s article entitled ‘Costa Ricas’ New Property Tax Proposal – The government wants a new system. (September 2006)’ is worth reading.

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Written by Scott Oliver, author of How To Buy Costa Rica Real Estate Without Losing Your Camisa and Costa Rica’s Guide To Making Money Offshore.

Andrew Makarik

to@welovecostarica.com

Andrew Makarik is the main editor of WeLoveCostaRica, a fan of this sunny country. He is also a loving husband and a has a lovely daughter. By being a devoted family man and the biggest Costa Rica fan, he wants to make more people feel at home there. WeLoveCostaRica unites people and helps them find new home or a new travel destination. This website is a friendly community where everyone can find not only information, but also new friends and travel pals. Andrew is also passionate about IT and programming, so he himself maintains a friendly atmosphere in this cozy environment of WeLoveCostaRica.com.