Thursday, February 18, 2010

French Give One More Reason for Moving to Costa Rica

The mountains, the beaches, the fresh air and the stress-free lifestyle … all great reasons for retiring to Costa Rica. But now, the French just gave you one more! It seems that France has classified Costa Rica as a tax haven … uncooperative because it has not implemented internationally agreed tax standards. The French also go by the standards set by the Paris-based Organization for Economic Co-operation and Development (OECD). It identifies three key factors in considering whether a jurisdiction is a tax haven:
1. Nil or only nominal taxes. Non-residents can escape high taxes in their country of residence.
2. Protection of personal financial information. The country has laws that protect businesses and individuals from scrutiny by foreign tax authorities. 3. Lack of transparency. The country can make it difficult, if not impossible, for other tax authorities to apply their laws effectively. And now, since Costa Rica is considered a tax haven, the French are as mad as a wet hen! In fact, they plan to tax dividends, interest and license fees paid by French firms to people or other firms domiciled in tax havens at 50% rather than the current maximum of 33%. Well, as far as I’m concerned, the Costa Rican government deserves a big round of applause for indirectly telling the French and everyone else to take their tax laws and shove them where the sun doesn’t shine! Maybe if Europe and the U.S. would manage their finances better, hard-working citizens wouldn’t be fleeing with their money to countries such as Costa Rica for some tax relief. Best wishes, George
P.S. For the complete reporting on the French's war against tax havens, click here.

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