The proposal for the tax modernizationpresented by the Government last Monday during La Semanal con la Prensa, from the National Palace, headed by Luis Abinaderhas provoked an avalanche of reactions from different sectors of society, including those who are part of the country’s reproductive system. Some in favor, others against.
Here we detail seven reactions from different positions on the tax reform.
1 CONEP: “We must preserve the pillars and foundations of that situation that we have in the Dominican Republic.” The National Council of Private Enterprise (CONEP), through its executive vice president, César Dargam, expressed his vision on the tax modernization proposal, highlighting the need to accurately address the proposed measures without compromising the pillars of stability that characterize the country. During his speech, Dargam highlighted that “the Dominican Republic is a paradise in our region,” emphasizing that the country enjoys political stability, sustained economic growth for decades and social peace.
“We understand that we must preserve the pillars and foundations of the situation we have in the Dominican Republic,” he indicated. In reference to the tax reform, CONEP stated that, although a reform of this type should not generate concern or harm the current climate, it is essential that the effects that each of the measures could have on the economy be considered in their proper dimension. . Dargam insisted that “each of the measures that are being introduced must be considered in its proper dimension.”
2. AIRD: The Association of Industries of the Dominican Republic (AIRD) stated that in a first reading a certain anti-industry bias is seen in the tax reform proposal presented by the Government.
However, in a statement, the AIRD, in order to give its opinion based on the proposal, wants to have in its hands the elements that will be presented to Congress and, at the same time, is opening the space to receive feedback from its partners.
In a brief statement they expressed that they are exhaustively analyzing each of the measures announced in LA Semanal yesterday.
“Prudence tells us to wait for the wording that the Executive Branch will send to the National Congress,” they expressed.
3 Adoptron: on your side, Circe Almánzarexpressed this Tuesday his concern about the increase in taxes on rum, as part of the proposals that the Government also expressed for alcoholic beverages. Almánzar warned that «any tax on rum would be counterproductivebecause it would not have the effects sought and could cause harmful effects, especially to the health of consumers.
«This increase is not going to be effective, will cause damage; Above all, it will impact Government collections because the trend could continue towards fewer collections and a decline in the sale of Dominican rum. Gentlemen, we are talking about the national industry, Dominican rum,” said the spokesperson for the Dominican Association of Rum Producers (Adoptron).
4 Adozone: also the Dominican Association of Free Zones (Adozona) expressed his opinion on the issue, and highlighted that they would lose competitiveness compared to other countries that do not levy income tax on the operations of the Free Zone Parks, as stipulated in the reform proposal presented by the Government yesterday. . They warn this could slow down attracting investments and job creation.
In a statement he expressed that “The Free Trade Zone model is equivalent in all the countries of the DR-CAFTA region with which we compete, and in none of them does there exist a tax figure like the one being proposed, which reduces our competitiveness.”
He indicated that they recognize the need for the State to have greater revenue to be able to make more and better investments for the nation; However, with regard to the proposal to levy income tax on the operations of Free Zone Parks, you consider that this should be reviewed.
5. Dominican National Brewery: the president of the Dominican National Brewery (CND), Fabian Suarez, He spoke: “We are analyzing absolutely all the implications that this has, we have not known the details of the final document,” he said.
He also emphasized that “clearly for us it is an affectation and we are worried for what it may mean, but at this moment we are analyzing all the implications to be able to give you a more concrete answer about what it means.
6. Asonahores: Dominican tourism could stop attracting investments and reduce its competitiveness, therefore, reducing its impact on the economy in job creation and tax payments, if the fiscal incentives that the sector has are eliminated.
This is the alert National Association of Hotels and Tourism (Asonahores) which requests that the tax reform be studied and reconsidered, as it will have a negative effect on the economy, with regard to tourism.
Asonahores explained that in order to attract foreign investment and create new hotels it is necessary to have a tax regime like the current one.
He indicated that the tax reform proposal proposed by the Government will cause hotel chains to move away from the Dominican Republic due to lack of competitiveness compared to countries in the region, and will cause a drop in local tourism.
7. Popular productive sectors: the proposal of tax reformpromoted by the government of Luis Abinader, will affect the popular sectors of the country, since basic products such as bananas, salami, avocado, oil, among others, will be subject to new taxes.
This is what the economist considered Apolinar Velozwho specified that the reform has a flaw: there is no measurement of the increase in income or the expenses that are intended to be covered with these taxes.
«People are going to pay more value added tax and a greater amount of selective consumption taxes. That is to say, tax reform rests on the consumer“said Veloz when asked about the subject by journalists from the Hoy newspaper.
