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20 years

Tensions flare with Panama over tax demands on confiscated vehicles

October 3rd, 2012 – Anyone who has ever taken a Costa Rican vehicle out of the country, perhaps to Nicaragua or Panama, knows there can be a lot of paperwork involved.  Exit permits, stamps, entry permits, more stamps, temporary insurance, and more stamps.  The process is no less complex for foreign vehicles, in this case from Panama, attempting to enter and exit Costa Rica. And, the process is even more complex for truck drivers.  It most certainly would be easy to forget a stamp or document here and there.


However, a group of Panamanians have now filed a complaint against Costa Rica, claiming that Costa Rica’s demands for import taxes on vehicles detained and confiscated while leaving the country for “improper paperwork” is unfair.


Under Costa Rican rules, a vehicle detained and confiscated for “improper paperwork” while exiting the country becomes an “imported” vehicle.  And, like any other “imported” vehicle, the Costa Rican tax authorities demand the same payment of import taxes and duties before releasing the vehicle.  If you’ve ever imported a vehicle here, you know that import taxes can approach 100% of the vehicle’s value.


It is not clear why the vehicles are let into Costa Rica in the first place with “improper paperwork.”


The Panamanians consider the situation unfair.


The president of Panama, Ricardo Martinelli, has expressed his concern in regards to the situation to Costa Rican President, Laura Chinchilla.


“We hope to get a response (from Costa Rica)…we have to, and will, defend our citizens, “ said Jose Raul Mulino, ministry of Security in Panama. “We do not want to cause any sort of crisis, but if we have to, we will, because this simply cannot be,” he added.


Carlos Roverssi, Costa Rican Foreign minister, said “We are not going to allow illegalities or non-compliance in tax payment. We will stand our ground on this matter.”


On Thursday, a commission formed with representatives from the Costa Rican Executive Branch will meet with their counterparts in the Foreign Ministry of Panama, in an attempt to resolve the conflict.


Although the matter is not the Foreign Ministry’s responsibility, they will be visiting Panama as a special request from Laura Chinchilla.


According to the Costa Rican Foreign Ministry, both countries maintain “excellent level of bilateral relations.”

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