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July 23, 2020

Costa Rican tax authorities delay VAT collection on cross-border digital services until October 1

Costa Rican private and public entities that issue credit or debit cards have until October 1 to prepare to collect value-added tax (VAT) on cross-border digital services. Suppliers and intermediaries may still voluntarily register as VAT taxpayers and begin collecting VAT on August 1, 2020.

Costa Rica's Minister of Finance delayed VAT collection on cross-border digital services by Costa Rican public or private entities that issue credit or debit cards (withholding agents) to October 1, 2020. According to the Minister's public statement, the delay will allow entities to implement the measures necessary for correctly collecting the VAT.

The delay only covers the withholding agents. It does not include VAT collection by suppliers or intermediaries of cross-border digital services that voluntarily register as VAT taxpayers. The suppliers and intermediaries will be able to voluntarily register as VAT taxpayers and collect VAT beginning August 1, 2020, as provided in the tax administration's Resolution No. 13-2020.

The Ministry of Finance is expected to issue an official statement indicating the date on which collection agents must begin VAT collection, as well as any other relevant aspects on this matter.


Contact Information
For additional information concerning this Alert, please contact:
Ernst & Young, S.A., San José, Costa Rica
   • Rafael Sayagués (
   • Randall Oquendo (
   • Daniel Quesada (
Latin American Business Center, New York
   • Ana Mingramm (
   • Pablo Wejcman (
   • Enrique Perez Grovas (



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