Costa Rican government intends to charge 2% tax to Casinos and Sportsbooks

The government is proposing a bill to the Congress, a proposal that will be analyzed starting on August 3rd, 2009. The plan is oriented towards regulating and controlling the operation of Costa Rica casinos and Costa Rica online betting centers by the creation of a National Commission, that will regulate the Costa Rica gaming companies activity. Such Commission would be formed by the Ministers of the Presidency, Security and Finance, the Executive President of the Costa Rican Tourism Institute (ICT), the General Attorney, the Director of Judicial Investigations (OIJ) and the General Superintendent of Financial Institutions.

The bill wants to charge a 2% tax on the gross income of Costa Rica casinos, sports books and Costa Rica gambling companies in general, in order to become an important source to reduce the fiscal deficit, since this increase would generate at least eighty million United States dollars per year.

The Vice president of the Costa Rican Casino Association, Jorge Hidalgo, considers this increase is excessive as casinos have been affected by the world financial crisis, and it is not the correct timing.

The Minister of Finances of Costa Rica affirms that all of these ideas respond to a need of finding new resources of income based on a loss in the fiscal revenues due to a decline in the expected production of the country.

In the opinion of attorney at law and expert in Gaming Law Mr. Augusto Arce, this measure is almost identical to a previous gaming license that was granted by the Costa Rican government in a similar fiscal crisis in the year 2003. In that year the entire Costa Rica offshore gaming industry was shocked by the government with an emergency gaming license that raised a significant amount for Costa Rica and attempted to regulate this gray area in Costa Rican Law. It is also his belief that the new law can be positive towards regulating and not prohibiting and industry that is legal in many jurisdictions around the world, he also mentioned that there are many aspects to discuss and that it will be very interesting to see how the complicated legal structures that these companies use can be approached from a payment point of view.