HomeSala IVConstitutional Chamber of the Supreme Court gives tax reform bill the go-ahead

Constitutional Chamber of the Supreme Court gives tax reform bill the go-ahead

The Constitutional Chamber of the Supreme Court declared on Friday that Costa Rica’s tax reform bill is constitutional. The bill will now go back to congress, where enough legislators have announced their support for the bill for it to pass.

The court ruled on three issues put forward by legislators who claimed the bill violated the constitution. One of the main issues put forward was that the bill affected the judiciary’s independence. Costa Rica’s Plenary Court made that ruling in mid-October. This caused doubt about the bill’s chances of passing, since the ruling meant it would need a supermajority of 38 votes to pass a second congressional debate.

This uncertainty surrounding the proposed bill caused Costa Rica’s credit rating to drop and the currency passed 600 colones per U.S. dollar for the first time in history in early November.

Friday’s ruling means that the bill now needs a simple majority to pass. Enough legislators from multiple parties have already declared they will vote to approve the bill.


To find out more about what’s in the tax reform bill, check out our episode of The Tico Times Dispatch on the topic:


The bill is meant to address Costa Rica’s growing public deficit. The country finished 2017 with a deficit of 6.2 percent of GDP in 2017 and is expected to grow to 7.2 percent at the end of this year. The Central Bank of Costa Rica warned that if the deficit isn’t contained and some type of tax reform isn’t passed, the country would face an economic downturn.

The bill also sparked a nationwide strike that started on Sept. 10. The strike was organized by public-sector unions and caused major disruptions throughout the country. There were sparks of violence between protesters and police, and President Carlos Alvarado was violently confronted by protesters.

Albino Vargas, secretary general of the Union of Public and Private employees and one of the main architects of the strike, announced on Twitter that he was still planning to oppose the bill:

 

The bill will now return to congress for a second debate. If it passes, it will go to President Alvarado’s desk for final approval, marking his first major legislative victory since he took office in May.


Thanks for reading The Tico Times. We strive to keep you up to date about everything that’s been happening in Costa Rica. We work hard to keep our reporting independent and groundbreaking, but we need your help. The Tico Times is partly funded by you and every little bit helps. If all our readers chipped in a buck a month we’d be set for years.

Support the Tico Times

Trending Now

Expect Gusts Up to 85 km/h and Rain in Costa Rica This Weekend

Gusts could reach 85 km/h in Costa Rica's mountains and northern Guanacaste today, with rain in the Caribbean and storms in the South Pacific.

Costa Rica Court Asked to Halt Shark Fishing Near Cocos Island

A Costa Rican environmental attorney has asked a court to temporarily prohibit the capture of several types of sharks in waters surrounding Cocos Island,...

Lufthansa to Drop Costa Rica Route in 2027 as Sister Airline Adds More Flights

German airline Lufthansa will stop operating its flights to Costa Rica in December 2027, but travelers will not lose the connection to Europe. Instead,...

Costa Rica Hotel Wins Two World Travel Awards, Putting Tárcoles in the Spotlight

A hotel on Costa Rica's Central Pacific coast has won two international tourism awards, bringing attention to Tárcoles, a area known for its crocodile-filled...

Pacific Low Has a 60% Chance of Turning Tropical as Costa Rica Braces for Rain

A low off Central America's Pacific coast now has a 60% chance of becoming a tropical depression, and heavy rain could reach parts of the region through the weekend. With soils already up to 90% saturated, here is what to expect and how to plan.

Heading Out for Halloween in Costa Rica? Expect More Police on Patrol

Costa Rica police will patrol cemeteries, churches, bars and costume parties this Halloween weekend. Here's what to expect if you're heading out Oct. 31.

Cristiano Ronaldo Announces Portugal Retirement at 41

Portuguese football legend Cristiano Ronaldo announced on Thursday he was retiring from international football at the age of 41. Ronaldo made his debut for...

Prosecutors Find No Costa Rican Victims in Epstein Files Investigation

Costa Rican prosecutors ask a court to dismiss their Epstein files probe after finding no local victims or suspects.

Costa Rica Dollar Supply Hits Record 20 Years After Colón Devaluations Ended

The dollar sits near ₡452 as Costa Rica marks 20 years since ending planned colón devaluations. Here's what is driving record dollar supply.
Loading…

Latest News from Costa Rica

Costa Rica Coffee Maker Chorreador
Costa Rica Car Rentals
Costa Rica Travel Insurance
Costa Rica Travel