Noticias

Tax Bulletin

June 2016

Tax information

Current Base Salary

¢424.200

Current Interest Rate
(As from March the 1st, 2016)

12.92%

Late payment penalty rate
(month or part month)

1%

Reference Exchange rate BCCR USD
(June 1st, 2016)

Buy:

¢531,98

Sell:

¢544,50

Competence of the Administrative Contentious Court in Municipal matters

Article 173 of the Political Constitution establishes a special appeal regime for municipal resolutions. The constitutional norm states that if the Municipality does not revoke or amends an appealed resolution, a Tribunal under the Judicial Branch may solve the administrative discussion. This means a judicial Tribunal assumes an administrative duty to consider the legality of municipal resolutions.

In agreement with the above, article 156 of the Municipal Law N° 7794 (April 30th, 1998), states that the administrative procedures culminates with the appeal before the Contentious Administrative Court. Furthermore, articles 189 and Contentious Administrative Procedure Law N° 8508 (April 28, 2006), points out the procedure by which the appeal against municipal resolutions will be handled by the Contentious Administrative Court.

However, in contradiction with the appeal regime established in article 173 of the Political Constitution and the legal dispositions described above, article 9 of San José´s Municipal Tax Law N° 5694 (June 9th, 1975), establishes that the administrative discussion related to the determination and reclassification of municipal taxes will conclude with an appeal before the Municipal Council.

Moreover, based on the above the Contentious Administrative Court has repeatedly declared not competent to admit appeals in municipal matters when the discussion is related to reclassification of municipal tax, stating that San José´s Municipal Tax Law contemplates a different and particular appeal regime compared to the one established in the Municipal Law and the Political Constitution, arguing that it is not possible to challenge Municipal Council decisions before the Contentious Administrative Court.

Taking into account article 173 of the Political Constitution, in harmony with the principles of legal certainty and congruence of the legal system, the constitutionality of article 9 of San José´s Municipal Tax Law could be questioned, since there is a constitutional instruction that states the possibility to access a legality control by the Contentious Administrative Court.

Finally, it is important to consider that resolutions issued by the Contentious Administrative Court as a nonhierarchical administrative body do not remove the possibility to discuss the legality of Municipal Council Resolutions. Once the administrative discussion ends, there is the possibility to initiate a judicial process. Our legal system contemplates a double control of the legality of Municipal Resolutions, first in the administrative procedure and eventually in judicial process.

William Zamora
Senior
Tax & Legal Services

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