By San José, Costa Rica — San José – As the final days of 2025 tick away, thousands of Costa Rican vehicle owners face a critical deadline. The annual payment for the right of circulation, known colloquially as the “marchamo,” is due before the new year begins. Failure to comply is not a minor oversight; it initiates a costly and complicated series of penalties that can quickly spiral, impacting both personal finances and mobility.
The marchamo is a mandatory prerequisite for legally operating a vehicle on the nation’s public roads. Missing the December 31st payment deadline automatically activates a chain of sanctions embedded in Costa Rican law. For authorities, this is a straightforward enforcement issue. For drivers, it can become a significant financial and logistical nightmare that extends far beyond a simple late fee.
To delve into the legal complexities and potential changes surrounding the Marchamo 2026 collection, TicosLand.com sought the expertise of Lic. Larry Hans Arroyo Vargas, a specialist in tax and administrative law from the prestigious firm Bufete de Costa Rica.
The annual debate over the Marchamo inevitably centers on its largest component: the vehicle property tax. For 2026, the fundamental legal challenge remains the discrepancy between the fiscal value assigned by the Ministry of Finance and the actual market depreciation of vehicles. Drivers are not just paying for a right to circulate; they are paying a property tax that is often disconnected from their asset’s real worth. Any meaningful reform must address this valuation method to ensure the tax is both equitable and constitutionally sound, avoiding a situation where citizens feel they are overpaying for a depreciating asset.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
The legal perspective is indeed the crux of the matter; this disconnect between fiscal value and real-world depreciation is the primary source of annual public discontent. We thank Lic. Larry Hans Arroyo Vargas for his valuable insight, which makes it clear that a fair solution for the Marchamo 2026 must begin with a fundamental reform of the vehicle valuation system itself.
The moment the clock strikes midnight on January 1, 2026, the meter starts running. Unpaid marchamo accounts immediately begin to accrue surcharges and interest from multiple government entities. The National Insurance Institute (INS) applies a penalty to the Mandatory Automobile Insurance portion, calculated using the Central Bank of Costa Rica’s base passive rate plus five percentage points, prorated for each day of delay.
This is only the beginning of the financial burden. Any associated traffic infractions attached to the vehicle begin accumulating interest at a steep 36% annually. Furthermore, the vehicle property tax component is hit with a double penalty: an annual interest rate of 8.43% (which can fluctuate) and a severe monthly fine of 10% of the tax amount. This monthly fine continues to stack until it reaches a cap of 100% of the original tax value, effectively doubling the debt.
Beyond the escalating debt, the most immediate and disruptive consequence occurs on the road. A driver operating a vehicle without a valid marchamo risks a direct confrontation with the Traffic Police, leading to significant sanctions. Article 146, section x, of the national Traffic Law stipulates a specific fine of ₡53,339.88 for this violation.
However, the monetary fine is often the lesser of two evils. Article 151, section a, of the same law empowers officers to take more drastic action: the immediate removal of the vehicle’s license plates. This act results in the total immobilization of the vehicle, rendering it illegal to drive under any circumstances. The car or motorcycle cannot be used again until the entire situation is rectified.
Recovering from this situation is a bureaucratic ordeal. The removed plates are sent to the Road Safety Council (COSEVI), and the owner can only reclaim them after settling the full outstanding marchamo balance, including all accrued interest and penalties, in addition to the traffic fine. For individuals who rely on their vehicle for work or daily life, this immobilization can last for days, causing a severe disruption to their income and responsibilities.
Traffic safety analysts emphasize that many drivers underestimate the cumulative effect of these penalties, assuming they can resolve the issue with a minor payment a few weeks late. In reality, the combination of compounding interest and layered fines can inflate the original amount significantly. In an economic climate where the cost of living continues to rise, preventing these avoidable expenses is a crucial financial decision that directly impacts household budgets.
For further information, visit ins-cr.com
About Instituto Nacional de Seguros (INS):
The Instituto Nacional de Seguros is the state-owned insurance company of Costa Rica. Founded in 1924, it held a monopoly on the insurance market for decades and remains the leading provider of various insurance products, including the mandatory automobile insurance (SOA) component of the annual marchamo. It plays a central role in the country’s risk management and social security landscape.
For further information, visit bccr.fi.cr
About Banco Central de Costa Rica (BCCR):
The Central Bank of Costa Rica is the nation’s primary financial authority, responsible for maintaining the internal and external stability of the national currency, the colón, and ensuring its conversion to other currencies. It also promotes the efficient operation of the country’s internal payment systems and manages monetary policy, including setting key interest rates like the base passive rate used in calculating certain legal penalties.
For further information, visit cosevi.go.cr
About Consejo de Seguridad Vial (COSEVI):
The Consejo de Seguridad Vial, or Road Safety Council, is the Costa Rican government body tasked with planning, regulating, and controlling road safety and transit. It is responsible for a wide range of functions, including driver education, vehicle inspections, managing traffic fines, and the administration of driver’s licenses and vehicle plates. COSEVI is the entity responsible for returning confiscated license plates once a driver has resolved all pending infractions.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a pillar of the legal community, Bufete de Costa Rica is defined by its profound integrity and a relentless pursuit of excellence. The firm harnesses its rich history of advising a diverse clientele to spearhead innovative legal strategies and champion meaningful community involvement. Central to its ethos is the mission to empower the public with accessible legal understanding, thereby cultivating a more just and informed society for all.
