Zelaya's foreign minister
says situation is worse


Ousted Honduran President Manuel Zelaya's foreign minister warns that the standoff between Zelaya and the de facto authorities in Tegucigalpa is worsening, not improving.  The minister, Patricia Rodas, says the only acceptable outcome is for the clock to be turned back to the day before Zelaya was deposed June 28.  

Negotiations to resolve the continuing fallout from the military-backed coup that ousted Zelaya in June are expected to resume today. At stake is whether Zelaya will be allowed to return to power ahead of elections scheduled for Nov. 29.

Ms Rodas, told reporters at the United Nations Monday that returning Zelaya to office is the only acceptable solution.  "And what the people of Honduras demand is a return to the day before the coup d'etat — the previous situation.  We do not want another situation because then the other situation would be just as illegal and criminal as the coup itself,"she said.

Zelaya quietly returned to the Honduran capital Sept. 21 and has been holed up at the Brazilian embassy ever since.

Ms. Rodas accused the de facto authorities of "torturing" Zelaya — surrounding the embassy with stadium lights and sharpshooters.  She said Zelaya is subjected daily to psychological warfare and threats of invasion and death.

Zelaya's opponents say he was trying to illegally change the constitution to extend his term in office.  They have rejected his demands to return to power ahead of the next month's election.  The international community insists he be returned to office as the legitimate, constitutional president of Honduras.

Ms. Rodas laid out her side's demands for a resolution to the crisis. "So any process will have to include an end to human rights violations, an end to the siege on the embassy, the restoration of President Zelaya, return to constitutional order — to rule of law — respect for the constitution and its laws.  Only then will the democratic process be legitimate.  Any other outcome is illegal," she said.

She also urged the international community to impose targeted sanctions on the coup perpetrators, saying that would weaken them sufficiently for the Honduran people to peacefully topple the government of now-president Roberto Micheletti and return Zelaya to office.

Two runningmates announced


Laura Chinchilla, the Partido Liberación Nacional  candidate for president, has named  Alfio Piva, the current director of  Instituto Nacional de Biodiversidad, as her first vice presidential candidate and Luis Liberman, a banker with Scotiabank, as second vice presidential candidate. Piva will coordinate environmental iniciatives while Liberman will address economic issues.

No reason to be frightened
at new luxury home tax

Dear A.M. Costa Rica:

Like most people, I prefer to not pay more in taxes.

I know that many of the folks with whom I work will be upset by, or at least interested in, the new amount that they'll be required to pay due to law 8683.

I felt that your recent article, while accurate, may have given some readers an overly-frightening view of the amount that they will be facing in January.

For a home valued at $400,000 U.S. dollars, the current amount of tax legally owed annually is  $1,000.   That works out to about $83/month. 

Under the new law, the total amount due will become $2,000.  About $166/month.  Double the old tax.  That's like buying an extra tank of gas every month.   In January one would be required to pay 1/4 of that ($250) for the time from October  to December, then again $1,000 for the time from January 2010 to Jan 2011. 

For a $1,000,000 home, the current tax is $2,500/year.  The new tax will be $5,359.

It does ratchet up for multi-million dollar homes.  If you have a $5,000,000 home here, you were required to pay $12,500 last year.  Next year you'll be required to pay an additional $23,012. That's a hefty increase:  $35,000 vs. $12,000.

I don't mean to trivialize the doubling (or even tripling) of homeowners' taxes.  I know that I am frustrated by the thought of spending more money, especially after a tough economic year.

When I lived in California, the taxes on my property there were higher.   I don't recall the exact amount I paid, but it was over 1 percent.   I did some research online and came to the conclusion that in Miami you would expect to spend about 2 percent.  On Hawaii, residential property taxes are "very low" at 0.55 percent to 0.90 percent.  Long Island, NY charges 1.9 percent.

More than the actual amount of the taxes, I am concerned about the complicated forms needed to report the property value and the potential for people to wind up with problems due to not paying enough attention to their responsibilities. 

I am also dubious that the prosperous politicians who impose this new tax will accurately report the value of their (sometimes various) residential properties. I would be interested in a story that specifically ferreted out the tax reports of said politicians.

Finally: I think that the real fear associated with this new law is based in the valuation of the properties.  Costa Rica is a country that suffers from strict laws, very loosely enforced.  People regularly game the system in the hopes that they will not get caught.  I've seen properties registered in Tamarindo at values that are 2 percent of their true market value because the penalty for getting caught with paltry valuations has, to date, been . . .  paltry.  

My guess is that the real reason that people are upset is that instead of paying $75/year on a $1,000,000 home, now people are going to have to make the tough decision to bring their property valuation into line with actual property value, or spin the wheel and face a possible 5x penalty if they get audited.