US embassy cable - 05SANJOSE2186

UNCLAS SAN JOSE 002186 
 
SIPDIS 
 
WHA/CEN 
EB FOR WCRAFT, BLAMPRON 
E FOR DEDWARDS 
WHA/EPSC FOR KURS, LGUMBINER 
TREASURY FOR VJORSTAD, RWARFIELD 
 
E.O. 12958: N/A 
TAGS: ETRD, ECPS, ECON, PREL, PGOV, SOCI, CS 
SUBJECT: GOCR REQUESTS AND EMBASSY SUPPORTS EXTENSION OF 
U.S. TREASURY TAX ASSISTANCE PROGRAM 
 
1.  Summary:  Embassy supports GOCR request to extend 
project of U.S. Treasury Department Office of Technical 
Assistance (OTA) Tax Team beyond December 31, 2005 projected 
termination date.  End summary. 
 
2.  Charge d'Affaires received the following letter from 
Minister of Finance on August 26, 2005: 
 
Begin Text: 
 
The purpose of this letter is to request your assistance 
with securing the continuation of a technical assistance 
program between the Ministry [of Finance] and the United 
States Treasury Department's Office of Technical Assistance. 
 
Under terms of an agreement signed last March between the 
U.S. Treasury and President Pacheco, a technical assistance 
project was initiated to assist the General Tax Directorate 
in improving its programs and its institutional strength. 
During the initial four months of the project, assistance 
activities have begun in the following program areas: Tax 
Appeals, Audit, Enforced Collection, Information Systems, 
Training and Planning and Management.  The impact of the 
assistance initiative has been very positive, but the 
accomplishments have been limited because of the shortness 
of time and there remains much to do.  Therefore, it is of 
great importance that the project be continued at the 
current or more rapid pace in 2006 in order to further the 
accomplishments. 
 
Improvement of the tax system and increased revenue 
collections are of paramount importance to the continued 
economic viability of Costa Rica, and I view Treasury 
Project Coordinator Larry Westfall and his team of expert 
tax administrators as instrumental in continuing our 
progress to realizing our strategic goals and to achieve and 
sustain required improvements. 
 
Sincerely yours, 
Federico Carillo Zurcher 
Minister of Finance 
 
End Text: 
 
3.  Embassy supports an extension of OTA assistance beyond 
the projected termination date of December 31, 2005.  We 
believe that the project has been very successful to date 
and will lead to more efficient tax collection and thus 
long-term fiscal stability, an important corrollary to the 
country's effective implementation of CAFTA-DR. 
FRISBIE