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(506) 223-1327        Published Tuesday, April 18, 2006, in Vol. 6, No. 76          E-mail us    
Jo Stuart
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One example came out in court
Even the high and the mighty duck taxes here

By the A.M. Costa Rica staff

Costa Ricans and some expats have a tradition of defrauding the government of taxes by declaring a very low value for property that is transferred. And the government never seems to catch on.

Only infrequently do the real numbers come to light to show the degree to which the government has been cheated out of tax money. That's because the actual sales price of property is confidential.

So a $1 million property may be valued at just a few thousand dollars when the notary doing the transfer shows up at Tributación to pay the taxes. Because the transfer tax can be 2.5 percent of more, the savings to the individual purchaser can be ample. The savings continue because municipal governments use the declared value for subsequent taxes too.

The Abel Pacheco administration has been seeking some $500 million in new taxes, but critics of the tax plan claim officials are not collecting the taxes they should now.

A court decision March 28 put new light on the tax situation. Under oath, property purchasers said they bought land in Manuel Antonio in 2001 for $80,000 but then declared the value "for fiscal purposes" at just 1.5 million colons, the court decision said.

This revelation would not be so unusual except that the purchasers were the wife of the mayor of San José, Johnny Araya; the wife of his brother, Rolando Araya, the 2002 Liberación Nacional presidential candidate; and the wife of a man just elected on the Liberación slate to be a national legislator.

Testimony in the court case described the transaction as a deal involving the three families. They were in court because the person who sold them the choice beachview property had stolen the land from a North American by creating a false deed.

Flor de María Viales Fallas is the wife of new deputy Oliver Jiménez Rojas. She runs a hotel in Manuel Antonio. The court eventually ordered that the North American should get the land back, but Ms. Viales was trying to show in court that she had been a purchaser
in good faith. She was candid about how much she and the others paid for the
Real estate math:
  x     .025

  $     115
property and why the amount listed in the Registro Nacional, 1.5 million colons, was incorrect.

The lawyer who prepared the paperwork for Ms. Viales and the Araya women, Juan Manuel Vasquez Vasquez, also testified. He said that 1.5 million colons was put for fiscal reasons to make sure the property was valued for very little in the Registro Nacional, according to a summary of his testimony contained in the court decision.

Transfer tax can vary depending on the nature of the transaction, but if the tax on this property sale were 2.5 percent, the correct tax should have been $2,000. The Banco Central says that the colon was worth 325 to the dollar on the day the sale was made, May 15, 2001. So the declared value expressed in U.S. currency was $4,615.

So by understating the purchase price, the Araya women and Ms. Viales would pay just $115 at 2.5 percent of the sales price. That would save them about $1,885.

The three-judge trial panel did not seem surprised by the revelation and treated it as just another fact in its written analysis and decision.

No matter what the Araya women and Ms. Viales paid in taxes, they are due for a refund now because the court threw out the sale and agreed with the North American that the original sale of his property to a Quepos man was fraudulent.

Ironically, Jiménez, the husband of the hotel owner, will get a chance to vote on new taxes when he takes his legislative seat May 1.

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San José, Costa Rica, Tuesday, April 18, 2006, Vol. 6, No. 76

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California wines picked
for inaugural dinner

By the A.M. Costa Rica staff

Wines from Lockeford, California, will be served up at the inaugural banquet for president-elect Óscar Arias Sánchez, according to a report from three wine companies that showed off their products here last week.

The wine tasting in a La Sabana restaurant involved vintages from Macchia, Pasos and Watts wineries.

Arias representatives at the wine tasting selected the three wines, said Gregg Meath, a lawyer who attended the wine tasting, said a news release. Meath represents the three wineries.

The wine tasting almost didn't happen. In a scenario familiar to nearly everyone in international business here, the wine company representatives found that 27 cases of their products still were on a dock in Florida, the news release said.

Frank Gayaldo, a grape grower and one of the organizers of the wine tasting, said that representatives of the wineries each brought three cases as backup.

Arias will be sworn in May 8 at the Estadio Nacional in La Sabana. Later he will host world leaders at a traditional inaugural dinner at the Teatro Nacional.

Suspected coke in cans
leads to man's arrest

By the A.M. Costa Rica staff

A 26-year-old Spanish citizen, en route to his homeland, fell into police hands at Juan Santamaría airport where officials said they found cocaine hidden in cans of beans.

The man, Jesús López Ortega, became the 12th suspected narcotics courier detained this year at the airport, according to the Ministerio de Gobernación, Policía y Seguridad Pública. López was coming from Nicaragua when he was arrested, agents said.

Agents said that López had two kilos of cocaine hidden in two cans of refried beans, three kilos attached to his body and one kilo in a hidden part of his backpack.

Holiday death toll
put at 12 for highways

By the A.M. Costa Rica staff

The final holiday traffic toll appears to be 12 persons killed, although any deaths among the 51 reported as injured could change that number.

The Cruz Roja is taking credit for saving more than 45 lives over the holidays with quickly providing aid to those injured on the highway and by savings six persons in trouble in the water.

The death toll from drowning stands at 10, including three youngsters. One death took place Saturday morning at Tamarindo.

Pact aims to boost
tourism in Caribbean

Special to A.M. Costa Rica

A new agreement between the Organization of American States and representatives of several Caribbean tourist groups aims to attract more tourists to the nations of the Caribbean, the organization announced.

In a statement Thursday, the Organization of American States said the agreement signed that day will help with training and other key elements to build the Caribbean’s tourist industry, which is the region's principal revenue source.

Secretary-General José Miguel Insulza, who signed the agreement for his organization, cited statistics ranking Caribbean travel and tourism as the world's NO. 1 contributor to regional economies, as the industry accounts for some 16.4 percent of gross domestic product and 2.6 million jobs overall in Caribbean countries.  Insulza signed the agreement at organization headquarters in Washington with the Caribbean Tourism Organization and the Caribbean Hotel Association.

Vincent Vanderpool-Wallace, general secretary of the Caribbean Tourism Organization, said the Caribbean is the most "tourism-dependent area in the whole world" and therefore "we should be doing tourism better than anybody else."

The U.S. Agency for International Development calls tourism the "backbone" for the Caribbean region's economic vitality, but adds that the region's success in attracting tourists threatens the Caribbean's precious natural resources that attract tourists to the region.

With this in mind, the agency's Caribbean Regional Program funds activities to promote sustainable development in the region, which include helping the Caribbean nations deal with vulnerabilities to natural and environmental disasters.

The United States and the other nations involved in the Summit of the Americas process have expressed support for addressing the special concerns of the Caribbean's small island states, which, in addition to environmental vulnerability, include illicit drug trafficking, illegal trade in arms, increasing levels of crime and corruption, the transportation of nuclear waste and economic vulnerability, health threats such as HIV/AIDS and increased levels of poverty.

Taxi driver's tip leads to arrests

By the A.M. Costa Rica staff

Two men arrived on motorcycles to stick up the El Roble service station in El Roble, Puntarenas, about 6:30 a.m. Monday.  The gunmen slugged the manager and escaped with 3.7 million colons, some $7,327.

But a taxi driver gave police a tip that led them to houses where eight men were detained and some 2.8 million colons in cash was retrieved from a septic tank and 900,000 colons were found in another household tank.
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A.M. Costa Rica's professional directory is where business people who wish to reach the English-speaking community may invite responses. If you are interested in being represented here, please contact the editor.

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San José, Costa Rica, Tuesday, April 18, 2006, Vol. 6, No. 76


Hello, Jersey, says Carlos Solano, who spent years working in that state and learned fluent English.

A.M. Costa Rica photos/Saray Ramírez Vindas
Passengers are a mixture of youngsters and adults and may be tourists or just locals.

Tico Train driver will customize your itinerary
By Saray Ramírez Vindas
of the A.M. Costa Rica staff

Everyone has seen the Tico Train rolling down the main streets on weekends and holidays. But what they may not know is that the engineer or driver is an encyclopedia of the downtown and a man whose life is entwined with that of U.S. president John F. Kennedy.

The train is actually a series of cars that run on the streets and avenues.  What was once just a ride for children when the train arrived from Florida in 1968 is now available to locals and tourists as well.

The driver, Carlos Solano Santamaría, can stop to give a special treat to passengers. He did so Sunday when his passenger list included a number of Mexicans. He pulled up at the Mexican Embassy in Barrio Otoya for a photo session and description of the ornate building.

Typically the train zips through much of the center city, accompanied by the commentary presented by
 Solano and sometimes his 10-year-old son. Parque Morazán, San Sebastian, the estación al Pacifico, Plaza de la Democracia and other sites are standards on the route.

Monday Solano remembered that he was the beneficiary of one of some 1,500 work visas that John Kennedy helped allocate to Costa Rica in 1963. Solano went to Trenton, New jersey where he shined shoes, sold newspapers and learned English fluently.

He brought his passengers to Casa Amarilla, the foreign ministry, where Kennedy had planted a ceiba tree when the U.S. president visited in 1963. The tree is still there and heavily protected. He also spoke about his second last name which links him as a third cousin to Juan Santamaría, the Costa Rican war hero whose day was celebrated Monday.

The train runs from 10 a.m. to 6 p.m., and during high season it may run every day. A good place to catch it is in front of the Holiday Inn at Parque Morazán.

You need to see Costa Rican tourism information HERE!

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San José, Costa Rica, Tuesday, April 18, 2006, Vol. 6, No. 76

More than
a little sip

This downtown pigeon is braving the flood at a fountain where the stream of water outweighs the bird many times over.

But Costas Rican pigeons are tough and thirsty.

A.M. Costa Rica/Saray Ramírez Vindas

Illegal tourists getting the boot by Ecuador from islands of the Galapagos
By the A.M. Costa Rica wire services

Ecuador's government says it will relocate 5,000 people living illegally in the Galapagos Islands. The islands are a World Hertage site by the United Nations Educational, Scientific and Cultural Organization.

The nation's environment minister, Ana Alban, said this week that the illegal residents had come to the islands as tourists and stayed, most of them on the
most-populated islands of Santa Cruz and San Cristobal. She said they would be deported to the mainland. She also said some 15,000 people live on the islands legally.

The Galapagos Islands are famous for hosting many rare species of birds, animals and plants. Ecuador's government says it is working to protect the archipelago from the effects of the many tourists who visit each year.

Another mad cow case surfaces in Canada's Province of British Columbia
By the A.M. Costa Rica wire services

Canada has confirmed a new case of mad cow disease in a dairy cow from British Columbia, Canada's most western province.

Canada's Food Inspection Agency announced Sunday that the 6-year-old animal had the brain-wasting disease, but the agency said no part of the animal entered human food or animal feed systems.
It was Canada's fifth known case of the disease.

U.S. agriculture officials have been invited to assist in the investigation. U.S. Agriculture Secretary Mike Johanns issued a statement saying he does not anticipate a change in U.S. imports of beef and cattle.

The U.S. banned the import of live cattle from Canada in 2003 following the discovery of a case of mad cow. The ban was partially lifted last year.

Margin between two seeking runoff spot narrows in Peruvian balloting
By the A.M. Costa Rica wire services

LIMA, Perú — Election officials say the narrow gap between two candidates vying for the second spot on the ballot for the country's run-off presidential election has tightened further.

Officials said Sunday former center-left president Alan Garcia leads pro-business congresswoman Lourdes Flores by less than 96,000 votes, with nearly 90 percent of the votes counted. Garcia led Ms. Flores by
nearly 110,000 votes Saturday.

The surge by Flores is attributed to heavy support among Peruvians living abroad whose votes are apparently starting to impact the election tally.

Since no candidate received half of the vote in the April 9 election, a presidential run-off will be held 30 days after the final results are announced. Either Garcia or Flores will take on nationalist Ollanta Humala, who took 31 percent of the vote.

Jo Stuart
About us

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