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Lawyer working on unpaid tax bill in Costa Rica, Pallister says

Hey there, time traveller!
This article was published 18/12/2018 (278 days ago), so information in it may no longer be current.

Three-and-a-half months after acknowledging he owed luxury taxes on his Costa Rican vacation home, Brian Pallister now admits that the bill remains unpaid.

In a year-end interview, the premier expressed frustration at being unable to make the payment, citing unspecified problems in navigating the Costa Rican bureaucracy.

While he told the Canadian Press in late August that he had paid what he owed — roughly C$8,000, including penalties — it turns out that he had, in fact, transferred the money to his Costa Rican lawyer, Paul Oporta, to carry out the transaction.

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Hey there, time traveller!
This article was published 18/12/2018 (278 days ago), so information in it may no longer be current.

Three-and-a-half months after acknowledging he owed luxury taxes on his Costa Rican vacation home, Brian Pallister now admits that the bill remains unpaid.

In a year-end interview, the premier expressed frustration at being unable to make the payment, citing unspecified problems in navigating the Costa Rican bureaucracy.

While he told the Canadian Press in late August that he had paid what he owed — roughly C$8,000, including penalties — it turns out that he had, in fact, transferred the money to his Costa Rican lawyer, Paul Oporta, to carry out the transaction.

"I've been assured by the lawyer that he is endeavouring his very best to get it done," Pallister said regarding unpaid taxes on his Costa Rica property.

RUTH BONNEVILLE / WINNIPEG FREE PRESS

"I've been assured by the lawyer that he is endeavouring his very best to get it done," Pallister said regarding unpaid taxes on his Costa Rica property.

"I've been assured by the lawyer that he is endeavouring his very best to get it done," Pallister said of the tax payment.

Asked what was causing the delay, the premier said: "I've got all I can do to sort out the things that Manitobans want me to focus on. I'm not going to solve the bureaucracy in Costa Rica. I've done everything I can to address the issue."

Pallister said it's not the first time he's been frustrated in his dealings with the Costa Rican administration. He said it once took his family "14 trips to get a licence plate" for one of his vehicles. "I'll just leave it there," he said.

Facebook / Tierra del Sol Arquitectura y ConstrucciónTake a look inside Brian Pallister's home in Costa Rica
Facebook / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción
Facebook / Tierra del Sol Arquitectura y Construcción - FACEBOOK / Tierra del Sol Arquitectura y Construcción

The Free Press first raised questions in early April about whether the premier and his wife, through their holding company, owed the national "Impuesto Solidario" (solidarity tax), commonly referred to as the luxury home tax.

The tax must be paid on properties that exceed a set value, which is adjusted annually. For 2018, the value is 129 million colones (C$284,730). The tax was instituted in 2009. Its stated purpose is to tax the wealthy to improve housing for the poor.

At first, Pallister denied owing any taxes in Costa Rica, although he promised to look into the matter. Ten days after the initial story ran, the premier served the Free Press with a legal notice of a possible defamation suit. His lawyer, Robert Tapper, made a number of demands on the newspaper, including a front-page apology, in order to avoid legal action. The Free Press refused.

On the Friday before the Labour Day long weekend, he told a Canadian Press reporter that he had had his property appraised and had found that he indeed owed the luxury tax.

In October, the Free Press, with the help of a translator, called a Treasury Department official in Costa Rica, who said the country had no record that the holding company through which the premier and his wife Esther own the vacation home, Finca Deneter Doce SA, had paid the tax.

When the newspaper confronted the premier with that information, he showed evidence that he had transferred US$7,052 US (more than C$9,000) to his lawyer. He said the amount included the tax owed, penalties for non-payment and the cost of the property appraisal.

NDP MLA Andrew Swan said Pallister "needs to get his act together" and stop blaming others for his failure to pay the tax.

In his own words: What Pallister said

April 3, 2018 – The Free Press reports Manitoba Premier Brian Pallister’s holding company has been flagged for nonpayment of a luxury tax owed on his Costa Rican vacation home for almost a decade.

April 3, 2018 – The Free Press reports Manitoba Premier Brian Pallister’s holding company has been flagged for nonpayment of a luxury tax owed on his Costa Rican vacation home for almost a decade.

"We have never received any legal or accounting advice that our house in Costa Rica was subject to this luxury tax. If we are, then we would be happy to pay it… I have always paid all of my taxes in Canada and Costa Rica." –Brian Pallister, in a statement to the Free Press.  Read the story

April 4, 2018 – After the Free Press’ story runs, the premier pledges to determine whether he owes luxury taxes in Costa Rica.

“We were given advice that (the luxury tax) didn’t apply to us, that it didn’t apply to our property. I’m disappointed to see it spelled out so clearly that it may. But that being said, (it’s) not impossible to revert to doing the right thing now, even though I wasn’t aware I was doing the wrong thing before… I think, in hindsight, we probably should have dug deeper on the issue, and I regret that we didn’t.” – Pallister, speaking to reporters at the Manitoba Legislature  Read the story

April 13, 2018 – The premier refuses to answer more questions about taxation on his vacation home and serves the Free Press with legal notice that he may launch a defamation suit over reporting of the story if the paper doesn’t apologize.

"The article was designed by the Winnipeg Free Press to impugn the integrity of Premier Pallister and to bring his reputation into disregard, odium and hatred.” – Robert Tapper, Pallister’s lawyer, in a formal notice sent to the Free Press under the Defamation Act  Read the story

April 16, 2018 – The premier refuses to discuss a possible lawsuit against the Free Press, but reiterates he’s looking into whether he owes taxes in Costa Rica.

"We’re making that determination as we speak. There’s a process to do that, and that involves a number of things. So, we’ve embarked on that.” – Pallister, speaking to reporters after a meeting in St. Laurent, Man.  Read the story

June 20, 2018 – CBC reports Pallister’s holding company failed to reassess the value of his Costa Rican home for the past decade, in contravention of local laws. The premier tells media he is still looking into whether money is owed.

"I've already taken all the necessary steps to get the information, and I'm waiting for a report back… I talked to the people down there that are working on it last week, and they said it's going to take some time." – Pallister, speaking to reporters at the Manitoba legislature. Read the story

Aug. 31, 2018 – The premier admits he owed and paid approximately $8,000 in back taxes and penalties on his Costa Rican home.

"Ignorance is no defence, I should have probably looked into it further (earlier.)" – Pallister, in an interview with The Canadian Press

Dec. 13, 2018 - In a year-end interview with the Free Press, Pallister admits the bill remains unpaid.

"The premier is the one who's had the ability to take care of this, to deal with this and he hasn't done it. And I don't think anybody can understand why," he said.

"I practised law for 14 years. If I was given money by a client to do something, I would go and do it. It'll be no different with a lawyer in Costa Rica. There is no reason why the premier hasn't taken care of this."

Pallister said he is not blaming his Costa Rican lawyer, who specializes in property and development law, for the delay. "I know (Oporta) pretty well. And he's not trying to screw me over," he said with a laugh. "He's not. When he says he's doing his best I know he's doing his best."

Oporta did not return requests for comment from the Free Press.

The Pallisters have owned property in Costa Rica for a decade.

larry.kusch@freepress.mb.ca

Larry Kusch

Larry Kusch
Legislature Reporter

Larry Kusch didn’t know what he wanted to do with his life until he attended a high school newspaper editor’s workshop in Regina in the summer of 1969 and listened to a university student speak glowingly about the journalism program at Carleton University in Ottawa.

Read full biography

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