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Costa Rica's approval of the Central America Free Trade Agreement (CAFTA) was the result of the first ever, nation-wide referendum, ending four years of heated debates on the subject. This has certainly allowed Costa Rica to remain one of the safest and most attractive countries for foreign investment in Latin America. The Costa Rican government and its ministries, as well as the financial institutions, have aimed to entice multinational corporations to take advantage of the most educated, computer literate and disciplined workforce, along with the modern production infrastructure the country is currently created, backed up by CAFTA's guarantees in different areas. Multinational commercial leaders such as Acer, Microsoft, Procter and Gamble, Cisco Systems, Oracle, Hewlett Packard, GE, Abbot Laboratories, Continental Airways and Intel Corporation have made sizable investments here, both financially and physically, with major production and distribution facilities. Western Union has chosen Costa Rica to host its Latin American regional operations center. Read More

In 1998, for the first time ever, Costa Rica was poised to earn more from high technology exports than from coffee or bananas or even its lucrative, thriving tourism industry. According to the Ministry of Foreign Trade (COMEX) , Costa Rica's recent export earnings amounted to $15.7-billion. Intel has led the way; its exports, from the three manufacturing facilities the processing giant is building here in Costa Rica. High-tech companies will spur the export boom, while traditional exports, such as coffee and bananas, will fall in percentages of overall figures, but in terms of revenue, will continue to grow. Costa Rica is building a competitive advantage for itself and the many multinational companies who have chosen or are pondering the option to operate here.

The World Bank has given Costa Rica an excellent bill of overall political and economic health. At its annual conference in El Salvador, the bank lauded the country as possessing "one of the most stable and robust" democracies in Latin America. It went on to praise the Costa Rica's "healthy economic growth rate" and "some of the best social indicators" on the continent.

With CAFTA being a reality now, not only multinational companies but condo developers, workers, job seekers and business owners are seeing the benefits of investing in Costa Rica. The new tax structure has broken down some of the barriers that made doing business in Costa Riva very costly in the past, making it easier to export locally manufactured goods, and giving consumers a ,much wider variety of low priced products and services to choose from.

Amongst the benefits of the free trade zones :

  1. 100% exemption on import duties on raw materials, components and capital goods;
  2. 100% exemption from all taxes and consular duties affecting the imports of machinery and equipment, as well as those of their accessories and spare parts, and on import of motor vehicles required for their operation, production, management and transportation.
  3. 100% exemption on imports of fuels, oils and lubricants required for the operation of these companies.
  4. 100% exemption on taxes on profits for 8 years, and 50% for the following 4 years for companies located in zones of “higher relative development”
  5. 100% exemption on taxes on profits for 12 years, and 50% for the following 6 years for companies located in zones of “lower relative development”
  6. 100% exemption on export taxes, granted also for re-exportation of production machinery and equipment from the Zones that have entered under this Law.
  7. 10 year exemption from the payment of taxes on capital and net assets, from payment of property taxes and from payment of the tax on transfer of real estate.
  8. 100% exemption from sales and excise taxes on purchases of goods and services, and from all taxes on remittances abroad.
  9. 100% exemption on municipal and capital taxes;
  10. No restrictions on capital repatriation or foreign currency management;
  11. Fully expedited on-site customs clearance;
  12. Can sell to exporters within Costa Rica;
  13. Can also sell up to 40% in the local market.
  14. Transfer of goods between companies within the zone

Costa Rica is at the turning point in integrating itself into the modern world economy and real estate investment presently plays a huge role in contributing to the country’s financial wellbeing. Here at 2Costa Rica Real Estate we are well aware of the needs of multinational companies regarding relocation services, consultants and every single aspect of the logistics required to get your company started.

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