Sign up for tax alert emails    GTNU homepage    Tax newsroom    Email document    Print document    Download document

October 17, 2023

Costa Rica removed from EU's 'blacklist' of non-cooperative jurisdictions for tax purposes

  • Costa Rica was delisted from the European Union's Annex I (commonly referred to as the "blacklist"), following the approved reforms to the country's Income Tax Law that amended aspects of the foreign-source income exemption regime.
  • However, Costa Rica was included in Annex II, pending the implementation of the Global Forum recommendations regarding the automatic exchange of information in due time.
  • Taxpayers, particularly financial entities, should monitor upcoming reforms that may be approved in this area.

On 17 October 2023, the Council of the European Union (EU) adopted the conclusions on the revised EU list of non-cooperative jurisdictions for tax purposes and decided to delist Costa Rica from European Union's (EU's) Annex I (commonly known as the "blacklist") following the reforms incorporated in the Income Tax Law through the approval of Law No. 10.381, to amend aspects of Costa Rica's foreign-source income exemption regime.

These reforms include a clarification to the scope of the territoriality principle and introduction of a new taxation regime for foreign-source passive income. (For more information, see EY Global Tax Alert, Costa Rican Congress approves bill to achieve exclusion from the European Union's list of non-cooperative jurisdictions in tax matters, dated 12 September 2023.)

After removing Costa Rica from Annex I, the EU decided to place the country in Annex II, pending the country's implementation of the Global Forum recommendations regarding automatic exchange of information. The goal is for Costa Rica to achieve determinations in Fall 2024 of, at least, "In place, but needs improvement" on Core Requirements 1 and 2 in the Global Forum peer review report.


For additional information with respect to this Alert, please contact the following:

Ernst & Young, Costa Rica

Published by NTD’s Tax Technical Knowledge Services group; Carolyn Wright, legal editor


The information contained herein is general in nature and is not intended, and should not be construed, as legal, accounting or tax advice or opinion provided by Ernst & Young LLP to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated. The reader should contact his or her Ernst & Young LLP or other tax professional prior to taking any action based upon this information. Ernst & Young LLP assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.


Copyright © 2024, Ernst & Young LLP.


All rights reserved. No part of this document may be reproduced, retransmitted or otherwise redistributed in any form or by any means, electronic or mechanical, including by photocopying, facsimile transmission, recording, rekeying, or using any information storage and retrieval system, without written permission from Ernst & Young LLP.


Any U.S. tax advice contained herein was not intended or written to be used, and cannot be used, by the recipient for the purpose of avoiding penalties that may be imposed under the Internal Revenue Code or applicable state or local tax law provisions.


"EY" refers to the global organisation, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.


Privacy  |  Cookies  |  BCR  |  Legal  |  Global Code of Conduct Opt out of all email from EY Global Limited.


Cookie Settings

This site uses cookies to provide you with a personalized browsing experience and allows us to understand more about you. More information on the cookies we use can be found here. By clicking 'Yes, I accept' you agree and consent to our use of cookies. More information on what these cookies are and how we use them, including how you can manage them, is outlined in our Privacy Notice. Please note that your decision to decline the use of cookies is limited to this site only, and not in relation to other EY sites or Please refer to the privacy notice/policy on these sites for more information.

Yes, I accept         Find out more