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Costa Rica lawmakers pass new property tax

Owners of properties worth more than about $182,000 will soon pay a new graduated tax, the first fiscal reform since President Oscar Arias took office in May 2006.

Approved by lawmakers yesterday morning, the tax will raise an estimated ¢9.7 million ($17,000) a year to fund the state´s efforts to rebuild substandard housing, according to an estimate by the National Assembly´s budget analysis department.

The bill, which will take effect once Arias signs it, imposes an annual 0.25 percent tax on properties worth between ¢100 million ($182,000) and ¢250 million ($454,500). The tax increases with the property´s value, up to a 0.55 percent levy on properties worth more than ¢1.5 billion ($2.7 million).

The taxes must be paid in the first 15 days of each year. Properties belonging to the government, public institutions, churches and non-profit organizations are exempt.

The revenue will go to the National Housing Mortgage Bank (BANHVI), which offers grants to poor families looking to rebuild their homes and neighborhoods. About 40,000 families live in substandard housing in Costa Rica, according to BANHVI spokeswoman Susan Otárola.

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