The Costa Rica National Chamber of Tourism (CANATUR) has expressed its absolute opposition to the government’s proposal of increasing or creating new taxes.
In light of the severe impact of the pandemic on the tourism sector, CANATUR emphasizes the need for incentives and opportunities to expedite recovery. The recently announced fiscal measures, part of the government’s strategy for fiscal sustainability, are viewed as detrimental to the sector’s growth.
Here I’ll delve into CANATUR’s concerns and highlights the importance of implementing alternative measures for a sustainable tourism industry.
Supporting the Tourism Sector’s Recovery
CANATUR firmly believes that the tourism sector requires support rather than additional taxation. The repercussions of the pandemic have already inflicted significant harm on the industry, making it imperative to foster an environment conducive to recovery.
President Rubén Acón emphasizes that the government’s proposed fiscal measures, including the increase in VAT on airline tickets, would hamper the competitiveness of Costa Rica as a tourist destination. CANATUR urges the government to prioritize rationalizing public spending and enhancing tax collection efficiency rather than burdening the middle class and small and medium-sized enterprises (SMEs) with new taxes.
Efficient Tax Collection and Rationalized Public Spending
CANATUR asserts that the government’s focus should be on combating tax evasion and improving the efficiency of tax collection. For instance, the organization highlights the need for effective enforcement of existing laws pertaining to the collection of value-added tax (VAT) on non-traditional hosting platform services.
By streamlining these processes, the government can enhance revenue generation without imposing additional tax burdens. CANATUR questions why such existing tax collection loopholes persist. Furthermore, the organization emphasizes that the government’s achievement of inflation and macroeconomic stabilization goals ahead of schedule makes it unnecessary to burden the middle class and SMEs with the adverse consequences of new taxes.
A Call for Policies to Boost Competitiveness
CANATUR has consistently called for the implementation of policies that enhance the competitiveness of the tourism sector. Rather than relying on increased taxes, the government should prioritize strategies that attract visitors and stimulate growth.
CANATUR believes that cutting public spending, alongside targeted investments in the tourism industry, would be a more effective approach. Many political parties, business owners, and associations share this sentiment, emphasizing the importance of sustainable tourism growth and the adverse effects that excessive taxation can have on citizens.
Final Thoughts
The Costa Rica National Chamber of Tourism’s opposition to the government’s proposed fiscal measures reflects the industry’s urgent need for support and recovery. By focusing on efficient tax collection, rationalized public spending, and policies that boost competitiveness, Costa Rica can foster a sustainable tourism industry and mitigate the economic impact of the pandemic without burdening its citizens with new taxes.
