LatinNews Regional Monitor: Caribbean & Central America - 19 October 2018

* Costa Rica’s central bank (BCCR) has issued a statement expressing support for the government’s proposed fiscal reform initiative, approved by the 57-member unicameral national legislature on 5 October, that seeks to address the country’s widening fiscal deficit, which closed at 6.2% of GDP in 2017. The BCCR’s statement is in response to a vote on 16 October by the supreme court (CSJ) against the draft fiscal reform proposal which among other things would replace the current 13% sales tax with a 13% value-added tax (VAT) and increase the number of products and services to be taxed. The CSJ cited fears that the fiscal reform initiative would affect the operation and independence of the judiciary and called for various points to be corrected such as those stipulating that the civil service review the performance of judicial officials and measures which (according to the CSJ) would reduce resources available for witness protection and to fight organised crime.

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