Sunset in Escazu, Costa Rica. Photo taken by AIRINC Surveyor Samuel Pearl Schwartz.
Costa Rica is changing the tax year
As of October 1, 2019, Costa Rica is implementing major tax reform. This began on July 1, 2019 and the changes implemented then included increased progressive tax rates on employment income, with the top marginal tax rate increasing from 15% to 25%. Costa Rica is changing the tax year, switching from a tax year beginning October 1st to a tax year beginning January 1st.
There will be a 15-month transition period beginning October 1, 2019 through December 31, 2020. The next tax period will begin January 1, 2021. The changes implemented October 1st are inflation-indexing of the tax brackets and the personal tax credits. The net effect of the changes compared to July 1st is a small decrease in income tax for middle and higher incomes. Social security contributions are unchanged.
AIRINC's Data Points: Your Global Mobility News
Want to learn more? The above excerpt is taken from Data Points, AIRINC's quarterly newsletter. Data Points brings you the latest updates from our Housing, Goods & Services, and Tax departments based on our expert international surveys, which are conducted by our global data collection team on-location.
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