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Another decree angers Costa Rica’s tourism sector

August 26, 2014

A reorganization of the Solís administration has the tourism sector on edge. On Monday, the Costa Rican Chamber of Hotels criticized a decree signed by President Luis Guillermo Solís that places the tourism sector under the authority of the Economy Ministry.

“There are members of the current Cabinet who underestimate the tourism sector,” the Chamber of Hotels stated in response on Monday.

In May, Solís named Wilhelm von Breymann as Tourism Minister. But Article 2 of Executive Decree #38536, published in the official newspaper La Gaceta on Aug. 20, states that tourism will fall within the same administrative sector as the Economy Ministry, as part of a reorganization of the executive branch ordered by the Planning Ministry and Casa Presidencial.

Article 5 states the economy minister will be the top official governing the economy, industry, trade and tourism.

Solís over the weekend told members of the media he was unaware the decree changed the tourism sector’s category. He acknowledged that the tourism industry is extremely important for the country, and he denied it was an oversight.

The National Tourism Chamber  (CANATUR) also voiced disapproval of the decree.

Chamber Executive President Pablo Abarca claimed that because tourism now is under the authority of the Economy Ministry, business owners believe the government is sidelining their sector.

“We are now a subsector of the economy, despite being a productive activity that generates more than 500,000 jobs, contributes 8 percent of the GDP, and represents 20 percent of Costa Rica’s annual exports,” Abarca said.

The Tico Times attempted to speak with the tourism minister to receive his response to the polemic, but his press office said he “would not yet address the questions because he is discussing the matter with Casa Presidencial.”

Problems with the new decree add to ongoing controversy in the tourism sector over a recent Finance Ministry decree ordering tourism businesses to charge sales tax on all outdoor activities such as rafting and ziplining, among others, as well as ordering them to pay back taxes for the past four years.

Ministry officials justified the measure in a new interpretation of the Sales Tax Law and in the context of reducing the country’s growing fiscal deficit.

Business owners argue they never collected the taxes because they were never notified to do so. Some have begun receiving official notifications recently from the Tax Administration setting Sept. 30 is a deadline to pay back taxes for the last four years.

Vice President Ana Helena Chacón, who also is coordinator of a government Tourism Competitiveness Committee, on Monday said the committee would lobby for a change to the ministry’s interpretation, although Tax Administration officials have continued to insist they will collect the tax as required by law, “no matter what.”

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