Finance Minister Daniel Toribio declared yesterday that it might be politically easier for the Fernández government to abandon its tariff reform proposals and seek only a minor adjustment thereof, "but that would be an irresponsible act that the current authorities will not commit." The DR has signed several trade agreements that necessitate the reforms, and the changes are necessary for the country’s competitiveness. He reiterated his argument voiced last week that the package the government is proposing is not a net tax increase as its opponents are portraying it. Tariffs are a tax too, he asserted, and the lower tariffs offset the overall tax impact of the proposed increases in the broad Transfer Tax on Industrial Goods and Services (ITBIS) and the Selective Consumption Tax (ISC) on alcoholic beverages and tobacco products. He rejected charges that the requested ITBIS rise from the present 8% to 14% in the year 2000 will affect the average family budget. Most basic items in the diet of average Dominicans are not covered by ITBIS, he asserted. Meanwhile the Executive Director of the Dominican Association of Exporters (ADOEXPO), Horacio Alvarez, yesterday characterized the reform bill as having less to do with export promotion and more to do with fiscal plans of the current government. For that reason, it does not enjoy the full support of the DR’s export sector. He called for the proposal to be amended so that exporters are refunded for ITBIS paid in the course of manufacturing exported products. "We cannot agree to this bill because we cannot export taxes," he declared.
