Countries › Costa Rica › Guide › 6. Taxes › Tax incentives in Costa Rica: free zone income tax holidays of 8 to 12 years, 6% and 15% rates for strategic manufacturers, and reductions for new SMEs

Tax incentives in Costa Rica: free zone income tax holidays of 8 to 12 years, 6% and 15% rates for strategic manufacturers, and reductions for new SMEs

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Last verified: 2026-10-29 · Status: Stable

The free zone regime of Ley 7210 exempts beneficiaries from income tax at 100% for eight years and 50% for four more inside the Greater Metropolitan Area, or 100% for twelve and 50% for six outside it, plus exemption from import duties, VAT on purchases, remittance taxes and municipal taxes. Manufacturers that need not export, under category f, pay 6% then 15% inside the GAM, or 0%, 5% and 15% outside it. New MEIC or MAG registered micro and small companies pay 0% of their income tax for three years, 25% for two and 50% in year six.

USD figures use the Banco Central de Costa Rica reference selling rate of ₡454.82 per US dollar published for 29 October 2026 (indicator 318 on bccr.fi.cr), rounded to the cent. The salario base for 2026 is ₡462,200 (Circular 246-2025 of the Consejo Superior del Poder Judicial, under Ley 7337 art. 2).

Key facts

Free zone income tax exemption inside the GAM	100% for up to 8 years, 50% for 4 years Ley 7210 art. 20(g)(1), as of 2026-10-29 · in force
Free zone income tax exemption outside the GAM	100% for up to 12 years, 50% for 6 years Ley 7210 art. 20(g)(2), as of 2026-10-29 · in force
Category f manufacturer rate inside the GAM	6% for 8 years, 15% for 4 years Ley 7210 art. 21 ter(d), as of 2026-10-29 · in force
Category f manufacturer rate outside the GAM	0% for 6 years, 5% for 6 years, 15% for 6 years Ley 7210 art. 21 ter(d), as of 2026-10-29 · in force
Category f investment for full exemption	US$10,000,000 and 100 permanent employees Ley 7210 art. 21 ter(e), as of 2026-10-29 · in force
Minimum fixed asset investment outside an industrial park	2000000 USDLey 7210 art. 18(ch), as of 2026-10-29 · in force
New MIPYME share of tax payable	0% years 1 to 3, 25% years 4 and 5, 50% year 6 Ley 7092 art. 15(b), as of 2026-10-29 · in force

The rule

1. Categories of free zone beneficiaries include export processors, export trading companies, services companies meeting the strategic eligibility index (banks, insurers and professional services excluded), park operators, research, shipyards, manufacturers under category f, health services centres and input suppliers outside the GAM (art. 17).Ley 7210, art. 17 as amended by Ley 10234 and Ley 10559, art. 17, 2024-10-17 official text · verified 2026-10-29 · changed: Ley 10559 of 17 October 2024 added film and music production categories; Ley 10234 of 4 May 2022 added health services centres and input suppliers outside the GAM.

2. Incentives: import of raw materials, components, packaging, machinery, equipment and certain vehicles free of import taxes; no export taxes; ten years' exemption from capital and net asset taxes, property tax and property transfer tax; exemption from sales and consumption taxes on purchases; exemption from taxes on remittances abroad; ten years' exemption from municipal taxes and licences; free FX dealings. Income tax exemption: inside the GAM 100% for up to eight years and 50% for the next four; outside the GAM 100% for up to twelve years and 50% for the next six, counted from the start of productive operations (art. 20).Ley 7210, art. 20 as amended by Ley 8794, art. 20(a) to (j), 2010-01-12 official text · verified 2026-10-29

3. Category f manufacturers (strategic sector or outside the GAM, new investment that could go to another country, not previously subject to income tax) are not bound by export results and pay income tax of 6% for eight years and 15% for four years inside the GAM, or 0% for six, 5% for six and 15% for six years outside it; with a new investment of at least US$10,000,000 over eight years and at least 100 permanent employees they get the full exemptions of art. 20(g) and (l) (art. 21 bis and 21 ter).
Cost to do it: Minimum initial investment in fixed assets to operate outside an industrial park: US$2,000,000 (art. 18(ch)).Ley 7210, art. 21 bis and 21 ter added by Ley 8794, art. 21 bis and art. 21 ter, 2010-01-12 official text · verified 2026-10-29

4. MEIC or MAG registered micro and small enterprises applying the small company scale pay 0% of the tax on profits in their first three years of activity, 25% in years four and five, and 50% in year six (Ley 7092 art. 15(b)).Ley 7092, art. 15 as amended by Ley 10392, art. 15(b), 2023-11-14 official text · verified 2026-10-29

5. Employers may deduct an additional amount equal to the pay of workers with disabilities who have difficulty obtaining competitive employment, plus workplace adaptation costs (Ley 7092 art. 8(b)); new industrial, agricultural and qualifying audiovisual companies carry losses forward for five years (art. 8(g)).Ley 7092, art. 8(b) and art. 8(g), 2025-03-10 official text · verified 2026-10-29

Worked example

A category f medical device plant outside the GAM with profits of ₡500,000,000 (US$1,099,336.00) a year pays 0% for its first six years, then 5% (₡25,000,000, US$54,966.80) a year for six years, then 15% for six more, against 30% under the general regime.

Step by step

Apply to the free zone regime through PROCOMER with the investment and employment plan.
Obtain the executive agreement granting the regime; terms run from the start of productive operations, which must begin within three years of publication.
File the transfer pricing information return, which is mandatory for free zone companies.
Track the step down dates of the exemption periods.

Common traps

Free zone sales into the domestic market are treated as imports and taxed.
Acquiring an existing taxable Costa Rican business can disqualify or reduce category f benefits (art. 21 bis(c)).
Free zone companies must file transfer pricing returns regardless of size (Reglamento art. 81).

Sources

Related: Costa Rica country profile · live dashboard · central bank and release calendar · our posts on X · where Argentina is involved, see The Argentine Thread guide

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