New immigration law to attract retirees
Recently, a modified version of the country’s former Pensionado Law was proposed to attract more expat retirees. The government realizes that currently retirees contribute around 500 million dollars annually to Costa Rica’s economy. So, it is in the country’s best interest to attract more foreign retirees to help shore up the ailing economy which has been battered by overspending, mismanagement and the insidious coronavirus.
So, on September 9, 2020, a new bill called “Law to Attract Investors, Rentistas and Pensioners” appeared in the official newspaper, La Gaceta. The purpose is to create new perks in order to attract retired people or those interested in investing and or living in the country.
Here are the new incentives aimed at attracting more foreigners. Now it remains to be seen if the newly-proposed pensionado law becomes reality.
Under the current current law the amount need to get residency as an investor is $200,000. Said amount will be lowered to $150,000. Investments can be in Real Estate or assets as cars, capital stock, securities and productive projects or projects of national interest. Assets can also be combined so as to total the $150,000 amount. For instance, a house that is worth $120,000 plus a vehicle that has a value of $30,000.
One-time duty free and all import taxes to import household items.
The amounts reported as income to obtain tax exemption benefits will be exempt from any income tax.
An exoneration of twenty percent on transfer taxes on Real Estate Property that the beneficiaries acquire in their personal name. If the beneficiary transfers said property within a period of less than three years, he or she must refund the difference in the exempted tax.
Finally, it is provided that this investment window will be in effect for five years.
All that has to be done now is to have congress support the new bill and make it an official law.
Attracting digital nomads is another way the Costa Rican government intends to increase tourism and revenues. Digital nomads travel around the world seeking unique destinations, adventure and new experiences. The advantage they have is that they can work remotely over the Internet from just about any place in the world. The government is trying to make the country more user friendly and turn the country into one of the prime destinations for this mobile group. Currently there are an estimated seven million millennial nomads working from different countries. And due to the pandemic 88 percent of business in the world is done by telecommuting remotely.
Costa Rica offers friendly people, tranquility, an ideal climate, multiple outdoor activities and the opportunity to live in a tropical paradise for those who want to work from here.
The idea is to create a renewable Nomad Passport whereby workers can work up to six months in the country.
Attracting international film and television productions
According to the Tico Times on-line newspaper, “Costa Rica is considering offering incentives to attract international film and television productions, which currently choose other destinations in the region where they do receive financial benefits.”
“The Legislative Assembly is discussing an initiative to promote investment and development of international productions of films, documentaries, TV series, commercials and music videos.”
“The country intends to compete with others such as Colombia, Panama, Puerto Rico and the Dominican Republic, which offer tax incentives or cash refunds in exchange for investments in audiovisual productions.”
“More than $345 million could be injected into the Costa Rican economy, thanks to the production chain generated by the film business.”
“This project is part of an agenda to reactivate the tourism sector,” declared Tourism Minister Gustavo Segura.
“The initiative seeks to exempt income taxes, as well as allow the duty-free importation of equipment and materials necessary for filming.”
“It also plans to expedite the granting of visas to the personnel involved and facilities to process the required permits.”
“Every time film productions come, there is an impact on tourism, because they hire transportation, lodging, food services, and link other sectors, such as actors and technical equipment for scenography, costumes, video and sound,”
“Among its advantages, offers a variety of locations close to each other, which allows lower production costs.”
“The country is small that a sunrise can be shot on the Caribbean side and that same day a sunset in the Pacific can be filmed without having to take a plane. Likewise, film crews can travel in a short time from a volcano to a beach or a jungle.”
“The film commissioner said that Costa Rica hopes to initially attract projects of $3 to 5 million, and in a few years, with more experience, to receive larger productions.”