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October 21, 2025
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Government spends more on subsidies than losses with salary indexation

Government spends more on subsidies than losses with salary indexation

He youth card bonuswith an amount of 2,500 pesos monthly in favor of 10,000 studentsis the latest incentive that was added to the repertoire of social assistance launched by the administration of President Luis Abinader.

Despite the speech of economic growthonly in 2024, the Directorate of Social Development Supérate spent more than 50,000 million pesos. Just for Feed yourselfwith 29,679.4 million, and Bonuseswith 7,434 million, more than 37,113 million pesos were allocated that year.

That total is double the approximately 18,200 million pesos that the Government would stop collecting during the year if it complied with the Law 11-92 of the Tax Code, which establishes the annual salary indexation to adjust the amount of salaries exempt from income tax (ISR) and the percentage of those who have to pay it, calculation estimated by the economist Richard Medina.

Another economist Nelson Suarezcomputed that, in the first eight months of 2022, the Government had collected 10,424.2 million pesos for the cumulative non-indexing of the ISR exempt scale. However, he acknowledged that the figure is timid and the amount is undervalued, because he based his report on the salary scale of 2.1 million workers registered with the Social Security Treasury (TSS) in March of that year.

If the Government complied with the law, only employees who earn more than 50,000 pesos per month would be subject to ISR withholding. Paragraph I of article 296 of the Tax Code points out that the established scales must be adjusted annually in accordance with the accumulated inflation from the previous year, according to figures published by the Central Bank.

However, the government has ignored this point since 2017, with an article contained in the General State Budget Law of each year, so as not to affect tax revenues.

To comply with the national budgetwhich includes subsidies, the Government, in addition to collections, must go to loans. Already the International Monetary Fund (IMF) has recommended that it should lower subsidies and apply other measures for the long-term sustainability of public finances.

Entry vs. exit

The list of social assistance programs It is wide and varied. In addition to Feed yourself and Bonusesare: Bono Luz, Get over yourself Women and Disability Fund.

There are them by season: The Brisitaat Christmas; Mother Bonusfor Mother’s Day; and Bonus a thousand, for the start of the school year. Also by geographical area, such as Family Farming Fund New Valley. There are also occasional ones, such as the fund for the families of the victims of the collapse of the nightclub roof. Jet Set.

Nails 1.5 million families They receive some type of aid from the Government, however, the number that stops receiving it is disproportionate to the number of beneficiaries. From 2022, at least 380,000 people have been able to escape this economic dependence, according to data reported by Gloria Reyesdirector of Get over yourself.

At a global level, the number of government dependents was around 5.3 million people to the second quarter of 2025, according to an analysis of Regional Center for Sustainable Economic Strategies (You believe). This is equivalent to 50% of the population, according to the X National Census of Population and Housing of 2022, which numbers the inhabitants at 10.7 million.

For next year, the government has stated in the budget bill, 738,460.6 million pesos for social services, which represent the 45.5% of the expense total and a positive variation of 10.9% (72,602.1 million pesos) in relation to 2025. This amount represents, in turn, a 8.5% of GDP. Within this segment, funds are also planned for the functions of education, social protection, health, housing and community services, among others.

Jealousy of the opposition and defense of the Government

The aid goes hand in hand with the speech of the economic growth that the Government presumes. However, the critics They see them as one of the symptoms of poverty that affects some social sectors.

At the same time opposition parties They complain that assistance is used with proselytizing purposesMainly, during election times – when complaints arise for violation of the Electoral Regime Law – the Government defends them by pointing out that they are the main antidote against monetary poverty, which was at 18.05% in the first quarter of 2025.

The economist Miguel Collado Di Francoexecutive vice president of Crees, understands that the ideal would be for the home to receive help in a natural way, not through agencies. taxes extracted to society.

“What is the best policy What can there be in any country in the world?” he asks. Next, he points out that conditions must be created for households to participate in the productive activities that add greater value and, consequently, receive higher income.

The economist points out that, when the technology and innovation with the economy to generate wealth and remember that was one of the recommendations of the State Department to the Dominican Government.

From Arroyo Cano, San Juan. Journalist at Diario Libre. Passionate about web programming, digital marketing and SEO.

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