Costa Rica: Protesters confront President Alvarado over tax bill

Costa Rica President Carlos Alvarado faced the scorn of protesters that tried to stop him leaving a theatre as nationwide protests against a proposed tax reform enter a fourth week.

Alvarado’s security entourage was pushed and shoved by demonstrators who hurled abuse at the president on Wednesday and implored him to “listen to the people” as he was escorted from the National Theatre in the capital, San Jose. 

The incident comes as an indefinite strike by public sector workers, that started on September 10, gains momentum.

Enrique Arguedas, the deputy director general of Costa Rica’s police force, said Alvarado was unhurt and no arrests were made following the incident.

“The president and the people [in the theatre] left securely,” Arguedas said in a video posted by the Ministry of Public Security.

Un presidente sin autoridad y sin liderazgo, deslegitimado. pic.twitter.com/V3bFZF80x2

— Allan Andres ? (@allanandresch) October 3, 2018

Translation: A president without authority and without leadership, delegitimised. 

According to Arguedas, several police vehicles were vandalised and police found at least three devices to puncture tires under their cars.

A video posted by Alvarado hours after the incident appeared to show the president in a public square. 

“Let no one take away peace […] this is Costa Rica,” he said before posing for photos with passersby. 

Four weeks of strike

The latest attempt at negotiations between trade unions and the government ended without success on Monday when the unions, after almost 100 hours of discussion, refused an agreement mediated by the Catholic Church.

Alvarado’s government says the bill will address the country’s growing deficit, but protesters claim the reforms disproportionately affect lower and middle class workers. 

The bill includes replacing the current sales tax with value-added tax and introducing a levy on goods which are currently exempt from taxation, including staple food items.

Salary increases, bonuses and severance packages in the public sector would also be limited.

In July, unions proposed an alternative bill with 38 suggestions, including scrapping “luxury” pensions for former presidents and applying higher taxes to businesses. 

Trade unions have so far been unable to reach an agreement with the government [File: Juan Carlos Ulate/Reuters]

While praising Costa Rica’s democracy and ability to “discuss in peace and respect”, Alvarado also called on public institutions to file lawsuits to have the strike declared illegal. 

A centre-left former cabinet minsiter and novelist, Alvarado won Costa Rica’s presidency in April on the promise of building a “government for everybody”. The 38-year-old beat a conservative evangelical pastor and singer, securing more than 60 percent of the vote. 

However, his government has so far been unable to control the country’s widening deficits. 

According to Heritage.org’s 2018 Index of Economic Freedom, Costa Rica’s budget deficits have averaged 5.6 percent of gross domestic product (GDP), while public deficit is equivalent to 43.7 of GDP. 

On September 26, Costa Rica’s Central Bank issued a statement detailing a short term loan of almost $870m to the Ministry of Finance to attempt to narrow the deficits. 

The country’s Legislative Assembly will begin debating the tax reform bill on Monday.