Costa Rica | The Costa Rican Government publishes the regulations to the Law for attracting foreign investors, rentiers and retirees

Foreign investors, rentiers and retirees that are interested in applying for the benefits contained in the Law N° 9996, must review the regulations to determine requirements and applicable procedures.

On 23 February 2023, the Government published in the Official Gazette the Executive Decree N° 43926-MGP-H-TUR, which regulates the dispositions contained in the Law for attracting foreign investors, rentiers, and retirees, Law N° 9996, enacted in July 2021.

The Regulations establish the requirements for applying to the immigration categories of investors, retirees, or rentiers before the Directorate for Migrations. The regulations also contain specifications and clarifications about the scope of the tax incentives and their beneficiaries, as well as the procedures for applying for such benefits.

The Law establishes the following incentives for investors, rentiers, and retirees:

§  Tax exemption from import taxes for imported household goods

§  An exemption from import, customs and value-added taxes for up to two land, air or sea transportation vehicles for personal or family use

§  Tax exemption for 20% of the total transfer tax, if the beneficiary is registered as the owner of the real estate acquired while the law is in effect

§  An exemption from import taxes for materials for professional or scientific practice if they are required to develop the individual’s trade or business.

§  An exemption from income tax of the amounts declared as capital investment by investors who qualify for the law incentives. The income will be subject to income tax, however, if derived within the national territory from the investments made in Costa Rica while the incentives are valid.

The Regulations entered into force on 23 February 2023, the date of its publication on the Official Gazette.

For additional information with respect to this Alert, please contact the following:

·       Rafael Sayagués | rafael.sayagues@cr.ey.com

·       Randall Oquendo | randall.oquendo@cr.ey.com

·       Daniel Quesada | daniel.quesada@cr.ey.com