Over the last 15 years, Costa Rica has attempted many different
reforms [to improve the fiscal balance]. None of them were
successful. Among other reasons, this was because people didn't
believe that paying more tax would improve their lives.
PARTING SHOT: Another way
Despite a rising deficit, mounting borrowing costs
and currency volatility, Costa Rica can avoid a ratings
downgrade, says its new president Luis Guillermo Solís
When you look at the numbers, you find that inequality was
increasing, corruption was increasing, and a number of things
that had to be done by the government were not being done
So we decided to try another way: just do our job, collect
taxes better - because tax evasion in Costa Rica is a national
sport, reaching around 50% in income tax. That's too much. We
decided to deal with it [via a new tax law, presented to
parliament in June).
At the same...
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