Update of the value of the lands in Costa Rica.The update of the value of the lands in Costa Rica is scheduled to initiate next November, confirmed Marietta Montero, Director of the “Órgano de Normalización Técnica del Ministerio de Hacienda” (Technical Normalization Entity, Ministry Of Treasure).
A Canadian company will be the one in charge of this particular job. However, Montero said that she can not give any company name yet because there are still pending some procedures to be accomplished at the “Contraloría General de la República” (State Control Office).
The value of the constructions is updated each two years, the last one was on 2005; though, only 25% out of the total, Montero quoted.
According to a study regarding the foreign investment in Real Estate in Costa Rica, published by the Central Bank last June, 2006, the real value of the terrains has not been updated since 1997.
The actualization program seeks the improvement of the legal security over the ownership of properties, according to the Vice-Ministry of Treasure, Jenny Phillips.
Implications. The update in the value of the properties will be helpful for: determine the value of the properties, the value of the transfer tax and the value of the property taxes, plus, as a reference for appraisals executed by the Government or private institutions.
With this information, Phillips quoted; we will be able to create value platforms.
These platforms will clearly indicate the specific value of a property according to the conditions of the area in which it is located.
Such information will be translated to the local Municipalities, so the property taxes to be paid by the owners are updated according to these values.
The contributors, said Phillips, have the right to declare the value they want; however, the Municipalities will have the right to make their own appraisal and then charge according to such appraisal.
The property tax is 0.25% for each million colones.
The Government sent a project to the Congress so the properties with a value exceeding the one hundred million colones, pay an additional 0.25%.
The transfer tax, instead, is charged each time a property is transferred by any reason, either the properties are recorded or not at the Public Registry. This transfer tax is paid equally by the seller and the buyer.
The base of this tax is the higher amount between the value declared at the transfer deed and the one recorded at the Public Registry.
Taken From La Nación, September 18, 2006, page 31.
For more details on the specific implications of this article, please do not hesitate to contact LandCo at
info@landcolaw.comBest whishes,
Lic. Francisco Molinero Hernández
LandCo®
Real Estate Legal Services
Attorneys at Law
Costa Rica
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