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Daily News - 1 March 2001
Retailers to pay less advance tax on gross sales
The Direccion General de Impuestos Internos, the department of taxes, and the Federacion Dominicana de Comerciantes (FDC), a major association of retailers, agreed on a 0.4% reduction in the advance gross sales tax to be paid by these. The government agreed that retailers selling more than RD$6 million a year will pay 1.1% monthly advance tax on gross sales, down from 1.5% that all other businesses are being charged. The director of the tax department, Teofilo Tabar said that this will be a pilot project. A breathing space of two or three months will be given to the retailers during which time the tax department will ascertain whether or not they can pay the 1.5% tax.
Record tax collections
The government has had record tax collections in January, as reported the Listin Diario. Tax collections at RD$5,234.9 million are up 8% from what the government had budgeted for the month. Collections for January 2001 were 26.8% more than those for January 2000 when they reached RD$4,130 million. When taking into account that expenditures were up to RD$5,184.3 million, the government had a RD$50.6 million surplus.
Of the government tax collecting offices, the Dirección General de Impuestos Internos received RD$2,316.6 million. this was RD$304.1 million more than received in January 2000, when they reached RD$2,012.5 million. This is attributed to the increase in transfer tax (ITBIS) from 8 to 12% and the start of the 1.5% advance tax on gross sales.
Customs Department collected 12.9% less in January 2001 than in January 2000. This reflects that importers stocked up in previous months in order to reduce the effects on their inventory costs of the new taxes that became effective 1 January 2001. Customs collected RD$1,159.3 million, down from RD$1,325.3 million in January 2000.
The National Treasury reports income of RD$1,759 million, RD$966.8 million more in 2001 than in January 2000, 122% more. The increase in the National Treasury total is due to the increase in government receipts of the petroleum differential surcharge, which reflects the increase in the price of petroleum products to Dominican consumers.
New ruling to bring job stability for teachers
The Minister of Education Milagros Ortiz Bosch denied that during her administration public school teachers have been fired or transferred. El Siglo newspaper reports today that the so-called Network of Civic Society Organizations does not exist. Participación Ciudadana denied it had issued an official position regarding the firing or hiring of political partisans in teacher posts, as stated the conclusions of a workshop organized by Centro Poveda, in which Participación Ciudadana participated. See http://www.dr1.com/daily/news022801.shtml). Fausto Rosario, director of communications of the group said that PC does not have among its mandate to discuss education and just attended the workshop as one other organization.
Minister Ortiz Bosch said that personnel problems in the education system are due to the delays in putting into effect the ruling that establishes the career of public school teachers, as per Law 66-97. Pending also is the creation of a court to deliberate matters of teachers.
She said that the ruling would begin to be implemented in two months time.
Resolution on increase in minimum wage for hotel & restaurants
The Ministry of Work published today, 1 March Resolution No. 3-2001 regarding the 15% increase of the minimum monthly wage for hotel, casino, restaurant, bar, cafes, cafeterias, night clubs, pizza parlors, chicken vending shops, fast food shops, vendor carts, ice cream shops and other food establishments. The publication establishes that the new monthly minimum wage will be RD$3,030 for those employed in businesses with assets over RD$500,000; RD$2,160 for those employed by businesses with assets from RD$200,000-RD$500,000; and RD$1,950 for those employed by businesses with assets below RD$200,000. The new minimum wage will be effective 15 days after the resolution, unless an interested party impugns it.
Legal advisor on human rights report
The legal advisor to the Executive Branch, Guido Gomez Mazara said that it is true that in the DR human rights are violated. He said these are not part of a state policy, though. He said they are not the result of an express decision of the Executive Branch to mistreat, violate or abuse relations with the community, such as he explained would also be true of the United States, where violations also occur. He said that the government accepts the report and commits to work to improve respect for human dignity. For more on the report, see http://www.dr1.com/daily/news022801.shtml
Newspaper editorial points out two forgotten human right violations
The editorial of El Caribe newspaper today denounces the violation of the right of all Dominicans to hold a Dominican passport. The editorial writer comments that the authors of the US State Department Human Rights Report do not mention violation of this right in the DR. It speculates that this is so because the US Embassy in Santo Domingo was whom put the pressure on the DR Department of Migration so that this human right be violated.
The newspaper explains that the US lobbied for this practice under the presumption that deported delinquents would use the passport to visit a third country, such as Colombia or Panama, to from there illegally enter the US through the Mexican border. The newspaper says that anyone who has never been involved in a crime in the DR, despite having committed this abroad, has the right to a passport.
El Caribe also criticizes that the extensive report does not cover the violent actions that have lead the Dominican police to confront with brutal force. The editorial mentions that the increase in violence in the DR is a result of the arrival of more than 8,000 deported Dominican delinquents that put into practice the criminal skills learned in the US.
The editorial writer concludes that a change in the policy of deportations of the delinquents and the not accepting of pressures by the Department of Migration would probably have resulted in a less critical report and could have a significant effect on reducing delinquency in Santo Domingo.
Amcham favors passing free trade agreement
The American Chamber of Commerce urged Congress to pass the Free Trade Agreement signed with Central America. The president of the American Chamber of Commerce, Andres Aybar said that the passing of the treaty is in the best interest of the nation. "The dynamic benefits of free trade agreements, as well as opportunities they offer for expanding trade and diversifying the base of local productivity are well known," said Aybar. He warned that, "to not do so is to navigate against modernity and economic progress," as per a report in El Siglo. He spoke during the February luncheon of the American Chamber of Commerce.
Challenges ahead for free zone industries
Fernando Capellán, president of the Dominican Association of Free Zones said that declining sales and the general slow down in the US economy will impact the rate of growth and development of Dominican free zones industries in the short range. He highlighted that the United States imports 90% of the production of Dominican free zones and 98% of apparel exports.
Capellan was the guest speaker of the American Chamber of Commerce luncheon held yesterday.
He also said that the elimination of quotas as per new rulings of the World Trade Organization by 31 December 2004 is a challenge the nation must meet.
He said the biggest challenge though is to take advantage of the present elimination of quotas that authorizes free export of products to nations with greater technological advances, vertical integration, stronger industrial tradition and lower costs.
At the luncheon, vice president of Adozona, Jose Clase also warned that the DR needs to be prepared to compete. He said that local industries are threatened by perspectives of cost increases at a time when US President Bush has given his support to granting similar textile parity trade conditions the DR enjoys to Colombia. "We need to be very aware that the sector cannot continue absorbing the increases in costs, we can not resist every day increasing energy bills, nor the social security costs as have been proposed," he said.
During the talk, Capellán highlighted the present state of affairs of the free zone sector in the DR. He said that free zone exports last year reached US$4,771 million, for a 10% increase over 1999. This was 80% of the total exports of the country last year.
He said the industry deposited US$1,000 million at the Central Bank, up 15% over the previous year.
Likewise, the sector employed 194,000 people in the 490 free zones that operate in 46 industrial parks in operation. Free zone industries purchased goods and services for more than RD$4,950 million on the local market in year 2000. Free zones paid their workers RD$12,000 million last year, which injected an average of RD$1,000 million per month into the economy.
Capellán highlighted the multiplying effect of the investments and free zone sector expenditures. He said that for every direct job created, two additional jobs are created outside of the free zones.
He also commented that the trend towards diversification of free zone production continues. While free zone apparel industries at one time made up more than 75% of all free zone companies, their prevalence has dropped to 56%. He said that in 1999, the National Council of Export Free Zones approved the installation of 74 new companies, of which only 27% were apparel manufacturers. New emerging companies such as services, technology, warehousing, distribution, food products and plastics are now being installed reducing the nation's dependency on one industry.
Mechanic work slowdown affects travel to DR
Travelers flying to John F. Kennedy International in New York and from JFK International to Puerto Plata and Santo Domingo airports were affected by a dramatic slowdown in work by mechanics. Thousands of passengers were affected with the cancellation of several flights. Reportedly, the strike affected American and TWA flights to and from New York's JFK International. Continental flights to Newark International, have not been affected.
More winter sales
Air Europa is advertising a US$595 fare sale for return flights to Madrid. La Novia de Villa has discounts of 10, 25 and 30% on in its store. Benetton is advertising sales in the Venta de Pasillos of Plaza Central. Ferrioni is advertising its goods are priced at RD$250 at Diamond Mall. Cento por Cento (Plaza Andalucia II Sur) offers discounts of 25-40%, Chicco (babies) advertises a 10-50% sale.
Yesterday's news briefs featured other winter sales opportunities. See http://www.dr1.com/daily/news022801.shtml
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