US Cars Tax Free - what does it really mean?

windeguy

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Jul 10, 2004
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From the headlines of DR1, DR-CAFTA has been around long enough that next year US Made cars can be imported tax free. What does this really mean?

If I want to import my own US Made car next year that cost me $30,000 US, a car that fully qualifies as tax free under DR-CAFTA, what will I actually have to pay in "fees" to bring it in and make it legal in the DR?
 

SantiagoDR

The "REAL" SantiagoDR
Jan 12, 2006
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Good Question

I thought I remember from way back when this all started that the "Import" would be free,
but the "First Time" registration would cost you a bundle.

Is that still true?

SantiagoDR
 

windeguy

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Jul 10, 2004
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SantiagoDR, Precisely the reason for my question. I recall the DR working up some new "fee" that charged about the same amount of money as the old duty. It appeared that this new fee would be in violation of the DR-CAFTA agreement unless all vehicles from all countries had the same new fee added on.

With the lack of transparency here, let's see if anyone can answer with what will actually happen.
 
Feb 7, 2007
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You most likely would pay ITBIS (16%) + first time registration/marbete (I think this is 10%) - you had to pay these two in the past, and will have to pay it in the future as well.
 

windeguy

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26% in fees to start with

You most likely would pay ITBIS (16%) + first time registration/marbete (I think this is 10%) - you had to pay these two in the past, and will have to pay it in the future as well.

Thanks, those two fees/taxes I can understand. That would be 26% to start with.

Anyone know if they tax the amount you actually paid for the vehicle or some imaginary value set by customs?

Do they tax the shipping charges as well?

Any other charges besides those two?
 

SantiagoDR

The "REAL" SantiagoDR
Jan 12, 2006
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So the "smart" thing to do would be to buy the car for direct "Export",
.... thus not pay any state taxes in the U.S. :confused:

Overall price would be cheaper + less on ITBIS tax + less on 10% tax
SantiagoDR
 
Jan 9, 2004
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These DR-Cafta/duty free car threads seem...

to take on a life of their own.

Several months ago a lawyer from Fabio Guzman's office had a meeting with Aduana concerning bringing some new cars in to the DR that a client of mine (dealer) had purchased directly from one of the manufacturers.

The end result was that Aduana indicated that the duty free provision of DR-Cafta as it relates to new automobiles was removed right before the signing of the agreement. And, my understanding of the provision was that, even though stricken, it never applied to used automobiles.

For those wishing general info, the duty is 20%, the taxes are 16% ITBIS on the value they ascribe to the vehicle, as well as 16 % ITBIS on shipping and insurance, which they calculations for (no matter what you paid for shipping and no matter whether you actually insured the vehicle), plus the first time registration which amounts to 17% of the vehicles value as calculated by Aduana.

Dealers, government officials and Dominicans returning to the Island receive a reduction in these taxes as well as anyone complying with and applying for residency under Ley 168.

Unless and until I can actually verify someone bringing an automobile in under the agreement, I will consider the information from Fabio's office to be valid....in spite of what is being reported in the Dominican press.


Respectfully,
Playacaribe2



Thanks, those two fees/taxes I can understand. That would be 26% to start with.

Anyone know if they tax the amount you actually paid for the vehicle or some imaginary value set by customs?

Do they tax the shipping charges as well?

Any other charges besides those two?
 

windeguy

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Jul 10, 2004
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DR CAFTA dosen't apply to US made automobiles at all - interesting

Thanks playacaribe2. Who would know? Nothing surprises me anymore. The fact that the Dominican press doesn't understand that US autos were removed from the DR CAFTA agreement included.

According to your post one would pay:
20% duty on vehicle
16% ITBIS on vehicle, shipping and insurance
17% of vehicles value to get it registered.

All of the base prices would be set by Aduanas.

So a vehicle with a US $30,000 US value, not what you paid for it but what Aduanas says it is worth, would be jacked up by 53% to US $45,900 plus the ITBIS on shipping and insurance plus the actual cost of shipping to bring it close to US $50,000 by the time you actually have it. And keep in mind there would be no warranty on the vehicle.
 
Jan 9, 2004
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You are pretty close.

For a rule of thumb, when trying to make a quick calculation of the potential taxes owed when you do not have access to the website for Aduana, I use 50% of the vehicles value as established by the NADA car guide.

To add insult to inujry, I believe the 16% ITBIS and the first registration taxes are calculated after the 20% Duty has been added. Sort of a tax on a tax.


Respectfully,
Playacaribe2



QUOTE=windeguy;786188]Thanks playacaribe2. Who would know? Nothing surprises me anymore. The fact that the Dominican press doesn't understand that US autos were removed from the DR CAFTA agreement included.

According to your post one would pay:
20% duty on vehicle
16% ITBIS on vehicle, shipping and insurance
17% of vehicles value to get it registered.

All of the base prices would be set by Aduanas.

So a vehicle with a US $30,000 US value, not what you paid for it but what Aduanas says it is worth, would be jacked up by 53% to US $45,900 plus the ITBIS on shipping and insurance plus the actual cost of shipping to bring it close to US $50,000 by the time you actually have it. And keep in mind there would be no warranty on the vehicle.[/QUOTE]
 

GringoCArlos

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Jan 9, 2002
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And don't forget the sneaky bastards in Aduana claiming that "this is not an American car - it has seats made in Mexico, an A/C system made in Canada, electronics made in Taiwan, blah blah blah - this isn't exempt as it's NOT a car made in the US"....
 

windeguy

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Jul 10, 2004
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I was thinking of that.

And don't forget the sneaky bastards in Aduana claiming that "this is not an American car - it has seats made in Mexico, an A/C system made in Canada, electronics made in Taiwan, blah blah blah - this isn't exempt as it's NOT a car made in the US"....


Good point Gringo Carlos. My original question about a US made car that fully qualifies was meant to take care of that eventuality. Just try and find a semiconductor made in the US.

Since US cars were removed from DR-CAFTA, it appears to be a moot point. :ermm:
 

windeguy

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Jul 10, 2004
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Since the Newspapers were wrong about DR-CAFTA and US autos

Since the newspapers were wrong about DR-CAFTA including US made automobiles, is there anyone on DR1 that can contact them so they can print retractions to the incorrect information they printed?