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Costa Rica seeks clearance on revised tax reform in drive to rein in deficit

Wednesday, June 22, 2011

Costa Rica's government drafted a new tax reform package expected to win support in Congress, in an effort to rein in a budget deficit that is the largest in Latin America by share of GDP.

Despite efforts to cut spending, President Laura Chinchilla has said the deficit, at 5.3 percent of GDP in 2010, could swell to 10 percent of GDP in 2016 if her fiscal reform plan is not approved.

The latest plan is a version of a package that was rejected earlier this year, tweaked to include proposals by opposition legislators, said Chinchilla's top cabinet officials.

Original source: Reuters