Central America and the Caribbean: Tax developments in Costa Rica, Guatemala, Dominican Republic, Honduras, and Nicaragua

The KPMG member firm in Costa Rica has prepared its monthly report for January 2026, covering the following tax updates in Central America and the Caribbean.

Costa Rica

• The Administrative Litigation Court issued Resolution N°10060-2025, rejecting claims by a financial entity against the State regarding income tax determinations for various fiscal periods. The dispute originated from a tax audit that questioned the exchange differential treatment for investments made abroad and rejected certain expenses. The court upheld the administrative acts challenged, confirming that income from exchange differentials is taxable when linked to economic activity conducted in Costa Rica.
• The First Chamber of the Supreme Court of Justice issued Resolution N°274-2024, dismissing a cassation appeal by a public institution against a ruling favoring the State. The State had initiated a declaratory relief action requesting payment of late interest due to improper withholding of income tax by the institution. The court upheld the lower court's ruling that the withholding agent is responsible for withholding on legally exempt income and corresponding interest.
• The First Chamber of the Supreme Court of Justice issued Resolution N°1335-2024, dismissing a cassation appeal by a company challenging administrative acts related to income tax for fiscal year 2010. The court confirmed the rejection of deductible expenses, stating that deductibility requires a direct relationship with income generation in the same fiscal period, and accounting standards cannot modify tax regulations.

Guatemala

• The Superintendency of Tax Administration (SAT) presented its management report as of December 2025, summarizing achievements in revenue collection and institutional management actions. The report includes revenue collection results, tax compliance indicators, and actions taken to reduce tax evasion and fraud.

Dominican Republic

• The General Agency for Internal Taxes (DGII) on January 15, 2026, issued Resolution DDG-AR1-2026-00001, informing taxpayers of adjustments to inflation adjustment multipliers and exchange rates for the fiscal year that ended December 31, 2025. The resolution includes updates for 2026, such as exempt amounts for residential properties and thresholds for transfer pricing regulations.
• The DGII on January 22, 2026, issued Notice 02-26, updating the amounts of the special contribution for solid waste management as established by Law No. 98-25. Contributions are set according to income ranges in Dominican pesos.
• The DGII on January 28, 2026, issued General Rule 01-26, extending exemptions from corporate income tax and assets tax for the agricultural sector for the year 2026.
• The DGII on January 29, 2026, issued Notice No. 03-26, informing taxpayers under the simplified tax regime that Articles 14 and 15 of General Rule No. 04-22 will not apply for the 2025 fiscal year. These articles relate to the tax treatment of income tax exemptions and adjustments.

Honduras

• As of February 5, 2026, the Tax Administration Service (SAR) has not published the 2026 average minimum wage, which is pending based on adjustments communicated by the Ministry of Labor and Social Security. Decree 48-2024 established new rules for contributions to the Honduran Social Security Institute (IHSS), with contribution rates set for 2024–2025. Employers are required to contribute to the Individual Capitalization Labor Reserve Fund.

Nicaragua

• The Ministry of Finance and Public Credit of Nicaragua on December 11, 2025, published Ministerial Agreement No. 008-2025, updating the rates of the fiscal stamp tax (ITF), effective January 1, 2026.