New tax blow for property owners

The payments which for some could in time total as much as $14,000 will come under a Rate of Recovery program says the general director of the Public Works Ministry, Ricardo A. Robles.

While the Rate of Recovery Commission has not yet decided how much each property will have to pay, it is expected that a 400 square meter apartment on Balboa Avenue would pay around $14,000 in ten years and those property owners who pay in advance might received discounts of around 10 percent.

Robles said that by the end of February the figure will be decided and they will take into account the value of the property, area of the plot, the density of the area, the social-economic conditions of the residents and how far they are from the Strip.

The Recovery Rate Department is currently analyzing the files of 10,000 properties in the area to determine how much money each one will have to pay, even if, as new purchasers they are exempted from property tax. The property owners will have 40 days to object to the figure given by the Recovery Rate Department, once it has published a list of the plots and their owners for three consecutive days in a local newspaper. If an objection is put forward then the Recovery Rate Department will have 60 days to give an answer to the complaint.

The director explained that this is not the first time that residents close to an area, where public works projects that benefit a large part of the population such as parks are located, have subsidized part of it, because Law 94 of 1973 authorized the government to do so, without having to consult the inhabitants.

The money collected by the recovery rate is going to be invested in projects similar to the Coastal Strip, without having to find financing elsewhere and will help reduce the government’s debt. The Coastal Strip project has raised a lot of criticism among real estate agents who believe that the additional charge of a recovery rate will put more strain in the already ailing property market.