New Tax Proposals and their impact

It is said that the elimination of the $200 USD exclusion on duty will decrease the number of exports from the DR because fewer ships will be sent to the DR instead of returning empty they take exports from the DR.  Fewer ships would mean potentially fewer exports.

The elimination of CONFOTUR would remove the CONFOTUR property purchase path to legal resdiency. 

What other taxes are included in the new proposals and their impacts?

Hmmm...I'm surprised at that! I would think that most small imports—total packages under $200—would be coming by air. Most freight forwarders have pretty high weight minimums for maritime transport. I know with CPS, the minimum is 70 pounds, and even at the maritime rate, that would be a lot of shipping expense on less than $200 worth of goods.

I haven't seen any proposed changes to limits in baggage, so I think if this change goes into effect, we will likely take more trips to the US and check more bags coming back!

Has any of the proposed tax modernization passed by the full chambers to become law or is it all still pending final approvals?

The tax reform is a proposal and gettting pushback in many areas. However the PRM is fully in charge of the government, so they can still make it so:

https://dominicantoday.com/?s=tax+reform

https://dominicantoday.com/dr/local/202 … ax-reform/

https://dominicantoday.com/dr/local/202 … state-tax/

https://dominicantoday.com/dr/local/202 … s-on-food/

https://dominicantoday.com/dr/economy/2 … -republic/

https://dominicantoday.com/dr/local/202 … uary-2025/

Santo Domingo.- The Dominican government anticipates that its Fiscal Modernization Project, presented at the National Palace, will take effect starting January 1, 2025, according to Finance Minister José (Jochi) Vicente. The reform, which has been in development for over five years, aims to increase tax revenues by 1.5% of GDP.

Hmmm...I'm surprised at that! I would think that most small imports—total packages under $200—would be coming by air. Most freight forwarders have pretty high weight minimums for maritime transport. I know with CPS, the minimum is 70 pounds, and even at the maritime rate, that would be a lot of shipping expense on less than $200 worth of goods.I haven't seen any proposed changes to limits in baggage, so I think if this change goes into effect, we will likely take more trips to the US and check more bags coming back! -@ddmcghee

You are correct about the air being most smaller cheaper items. Here is an answer from another forum on that issue:

The tax would reduce the amount of cargo for inbound courier shipments, cargo that fills aircraft space. Air cargo carriers are determined every aircraft must be full to make revenue. They do not fly empty. It costs cargo aircraft owners about US$ 29,000 an hour, full or empty, to operate an aircraft. If they are unable to fill the aircraft on a regular consistent basis, flights are reduced. Reduced inbound flights means less aircraft (space) available for outbound flights. It would drive up the cargo costs for Dominican exporters wanting to use remaining flights. The tax on internet purchases under US$ 200 brings trouble.

I have tried to  post this topic a number of times and  this is what I had said:

We need a thread to discuss what is going on here with the reforms.  It is all over the news. 

First point to make is that they are in discussion they are NOT  LAW  yet.

Many of these reforms will affect us.

Some highlights of the proposals :

Doing away with many investment incentives.

Changing the  limit of property, where you do not pay annual taxes. Currently it is at about  US $175,000 and they are proposing it be the sum of all your properties and the limit will be  RD 5,000,000 RD, about US 85,000. Above that the tax annually is 1%

Anyone making over  52,000RD a month will now need to make declarations to DGII. (this is not pension income)

Moving the ITBIS tax to 18% with limited exemptions

Increasing  tax on alcohol and cigarettes etc.

Eliminating the break on ITBIS for online purchases below US 200.

Merging some ministries and departments.

Double the fees for the Marbete

Of course there are a lot more items and details but this is the general idea.

Apparently  the  application of taxes under US 200 would violate CAFTA or one of those agreements.   Lets see what they do.

Yes this gov't has  majorities so they really can  push through their agenda.   Let hope they consider the effects on the poorest people who can afford this the least!   they need to expand  exemptions from  ITBIS  etc to include ALL the basic food items!

Apparently the application of taxes under US 200 would violate CAFTA or one of those agreements.  Lets see what they do.Yes this gov't has majorities so they really can push through their agenda.  Let hope they consider the effects on the poorest people who can afford this the least!  they need to expand exemptions from ITBIS etc to include ALL the basic food items! -@planner

The attempt has been made to violate DR-CAFTA before at least a couple of times by charging duty for items under $200 US.

There seems to be a short memory on this particular point. 

That is how I recall it as well.