New law establishes fines for not declaring property values

The owners of lots, homes, businesses or farms are exposed to a financial penalty if they do not update the value of their property to the respective municipality.

This is established of Tax Management Act, short time ago was approved by the Legislative Assembly.

Until now, the owners were obliged to report to the city council the value of their property every five years.

Many owners do not update, dozens of properties listed with very low values, resulting in lower revenue from property taxes, which corresponds to ¢ 2.500 per million in land value.

However, Article 10 of this law set a financial penalty for not doing the update.

“When the taxpayer has not filed the Declaration the tax shall be fined an amount not to pay”, sets the rules.

For example, if a person paid ¢ 50,000 less for a year because not updated the price of a home, the municipality may charge it.

Francisco Sánchez, Director of Revenue Management Services and the City of Heredia, announced that already apply that law.

That local government is in a period of updating property values.

However, this does not happen in all municipalities.

For example, Orlando Esquivel, head of collections of the Municipality of San Jose, explained that first there must be an analysis of the Legal Department, to define the way the law apply.

Some municipalities doubt if the fine should be applied once or if possible give a grace period for taxpayers.

Randall Marin, legal adviser to the National Union of Local Authorities (UNGL), considers that the fine will cause more people to pay for the actual value.

“The intent of the standard is to establish at least some penalty for this breach,” he said.

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