Our analysis of social media reactions to Costa Rica’s proposed visa run bill reveals a concerning rise in xenophobia. We examine the facts about perpetual tourists, taxes, jobs, and why they’re being scapegoated for deeper economic issues.
The recent proposal to halt perpetual tourism has caused somewhat of an upsurge in xenophobia on social media. It seems that a lot of Costa Ricans are now directing their rage and frustration about high prices, high cost-of-living, and gentrification to perpetual tourists.
It’s completely understandable that people are angry about being priced out of their communities and about tourists taking jobs. Once upon a time, Ticos hated on Nicaraguans for taking their jobs. Now it’s on “perpetual tourists” for, well, the same thing plus gentrification. But here’s the thing. Despite the recent press coverage about Migración stepping up raids on restaurants, bars, and shops in beach communities like Santa Teresa and finding lots of tourists working in them, these people don’t represent the majority of perpetual tourists.
Many perpetual tourists in Costa Rica are retired and don’t work at all, often coming as snowbirds for a portion of the year. Other perpetual tourists work online, either for themselves or for companies in their home countries. They’re digital nomads. The impression that they’re stealing jobs and not paying taxes is incorrect and unfair. And yet, that’s somehow become the narrative here. In this article, we want to break down what people are actually angry about, now they’ve been whipped up like this. We’re not interested in debating the rights and wrongs of perpetual tourism at all. The aim here is to try and present some balance to the “gringo get out” comments on social media that we’re seeing at the moment.
Housing & Gentrification: The Real Core Issue
The most heated social media comments center around housing affordability. As one Costa Rican commenter notes, “Haven’t you noticed that so much tourism has shot up the prices of properties, park access, etc. for Ticos themselves?” This sentiment—that tourism has dramatically increased property prices—reflects genuine pain felt by locals who see their communities becoming unaffordable.
Beach communities have undergone dramatic transformations, with housing costs all over rising beyond what local salaries can support. A growing disconnect exists between local wages and the housing market that now reflects international purchasing power. Yet what many discussions overlook is that the proliferation of short-term vacation rentals primarily drives this housing crisis, not “perpetual tourists” who often rent long-term or purchase single properties as homes. The anger is real and legitimate, but the target is misplaced.
Taxes & Economic Contribution: Misconceptions Abound
Social media comments frequently accuse perpetual tourists of tax evasion: “They don’t pay taxes on the services and products they sell, they DON’T pay into social security.” This narrative suggests foreigners are getting a free ride.
In reality, the tax situation is more complex. A critical point often overlooked is that Costa Rica operates on a territorial tax system. This means the country only taxes income earned within its borders. Foreign-earned income is not subject to Costa Rican taxation regardless of one’s immigration status. A digital nomad working for a U.S. company or a retiree receiving pension income from abroad is not evading taxes by not paying Costa Rican income tax on these earnings—they’re simply following the law as designed.
This same rule applies to Costa Rican citizens. A Costa Rican online worker who freelances for clients outside the country does not need to pay Costa Rican income tax on those earnings either. The territorial tax system applies equally to citizens and foreigners alike. And this doesn’t apply only to Costa Rica. Every country in Central America operates on a territorial tax system, and most other countries around the world, for that matter.
The line is crossed, however, when anyone—tourist, local, or resident—sells services or products within Costa Rica without reporting this income and paying the appropriate taxes. A tourist teaching yoga classes, selling real estate, or providing chef services to local clients without proper documentation and tax compliance is breaking the law. This kind of tax evasion represents a legitimate concern and appropriate enforcement is justified.
Foreign business owners who establish legal businesses in Costa Rica must pay all required taxes and social security contributions regardless of their immigration status. Many foreign-owned businesses operating properly contribute significantly to the local economy by paying corporate taxes, VAT, employee Caja contributions, and other required fees.
Perpetual tourists also pay VAT on all purchases. They pay property taxes and vehicle taxes (marchamo) that one commenter describes as “scandalously expensive.” They pay import taxes when bringing goods into the country. Another commenter points out: “Those of us who are perpetual tourists don’t use public healthcare or public education or any public services except the roads. We pay VAT, we pay special taxes, and we pay taxes on earnings! It’s a WIN-WIN for the country!”
Employment & Jobs: A Complex Reality
The accusation that foreigners are taking jobs from locals has gained traction following recent enforcement actions. Just within the last week, authorities conducted raids in Santa Teresa that found 40 foreign nationals (mostly Argentineans, it seems) working illegally on tourist visas in local establishments. These operations have highlighted legitimate concerns about compliance with labor laws.
This is a valid issue that deserves attention. When businesses hire tourists without work permits, they often circumvent important labor protections and tax obligations. It can create unfair competition and undermine opportunities for local workers.
However, it’s important to note that while illegal and wrong, it’s not an Argentinian surfer earning 10,000 colones a day in a beach restaurant or a Canadian yoga instructor who’s driving gentrification. These people are often living on modest incomes themselves, far from the affluent stereotype portrayed in social media discussions. The real drivers of gentrification are property investors, developers, and those converting long-term housing into lucrative vacation rentals.
Much of the responsibility lies with the business owners—many of whom are Costa Rican—who deliberately circumvent labor laws to reduce costs. By hiring unauthorized workers, they avoid paying into the social security system and often pay below minimum wage, creating an underground economy that hurts legitimate businesses and workers alike.
The social media narrative often paints with too broad a brush, suggesting that all “perpetual tourists” are taking jobs from locals. The reality shows more nuance. Many long-term visitors fall into different categories: retirees who don’t work at all, digital nomads who work remotely for foreign companies, or investors who create businesses that employ local residents.
The intendant of Cóbano (which includes Santa Teresa) points to another dimension of this problem. He notes that many businesses struggle to find local staff with the necessary language skills and customer service training to serve an international clientele. Although no excuse for hiring illegals (and we don’t really believe this, anyway), this highlights the need for better educational opportunities and training programs in tourist areas.
Social Security & Public Services
A recurring theme in comments is the accusation that perpetual tourists don’t contribute to the Caja (Costa Rica’s social security system) while potentially using services. However, several key points challenge this narrative.
Without residency status, perpetual tourists cannot access Caja services even if they wanted to (well, they can, but they have to pay for it on the ground). Most pay for private healthcare when needed. Many would willingly pay into the system if the residency process were more accessible.
As one commenter noted, “Perpetual tourists pay for private medical services, alleviating the Caja system and propping up the private hospitals.”
A Sudden Shift in Public Discourse
Perhaps the most striking aspect of the current social media climate is how recently this hostility emerged. Until the post-pandemic cost-of-living increases, few Costa Ricans expressed concerns about perpetual tourists. It truly has not been an issue that kept people awake at night. What’s particularly notable is how political entities like Frente Amplio have pivoted their messaging. Once defenders of immigrants against xenophobia, they now channel similar sentiments toward wealthier foreigners, portraying them as responsible for gentrification and rising costs.
This represents a significant shift in where public resentment is directed—a shift that seems politically motivated rather than organically developed. The timing coincides with broader economic pressures that have more to do with global inflation and housing market dynamics than with the presence of foreign residents.
The Real Solution Lies Elsewhere
The misdirection of anger toward perpetual tourists distracts from addressing the actual drivers of gentrification high cost-of-living. Simply restricting visa runs won’t solve the complex economic challenges facing tourist communities.
A more effective approach would require multiple policy solutions working together. First, improving and streamlining the residency process would allow more perpetual tourists to formalize their status and contribute fully to the system. Second, better enforcement of existing labor and tax laws would ensure everyone plays by the same rules. Third, targeted investment in education and training for locals would create more opportunities in the tourism sector.
Most importantly, Costa Rica needs housing policies that specifically address affordability in high-tourism areas. This includes regulating and taxing short-term vacation rentals and creating incentives for long-term rental development. Without addressing the underlying housing supply issues, other measures will have limited impact.
Conclusion: Finding Balance Without Scapegoating
Costa Rica has legitimate reasons to ensure that its immigration policies serve the country’s best interests. However, the current social media discourse risks damaging the country’s reputation for hospitality while failing to address the root causes of the economic pressures many communities face. If Costa Ricans come across as xenophobic and angry towards tourists, then tourists will stop coming, period. Most expats in Costa Rica (whether legal residents or perpetual tourists) came here in the first place out of love for the country and its people.
As Costa Rica navigates these complex issues, it would benefit by focusing on evidence-based solutions rather than emotionally satisfying but ineffective scapegoating. The country’s long tradition of welcoming visitors has served it well, and maintaining that tradition while addressing legitimate concerns about community preservation will require nuanced approaches beyond simply restricting tourism.
