The Costa Rican Legislative Assembly approved in first debate a reform that reduces income tax for lower income self-employed workers. The reform raises the exempt threshold to ¢520,000 per month (¢6,244,000 per year). In addition, it establishes new tax scales from 10% to 25% for income above that amount. This change seeks greater tax equity, since previously self-employed workers started paying the tax from ¢344,000 per month, while salaried workers have a higher threshold.
Tax Reform: Changes in Income for Self-Employed Workers
Main Modifications
- New exemption threshold: ¢520,000 per month
- Annual threshold: ¢6.244.000
- Tax scales: 10% to 25%
Impact and Comparison
- Previous threshold: ¢344,000 per month
- Objective: Matching with salaried employees
- Status: Approved in first debate