The influential Archbishop of Santo Domingo appealed to the government not to burden poor people any further with new taxes. Speaking at a conclave of some 20 Latin American bishops convened in Santo Domingo to launch the ?new evangelization of the Americas,? Nicolas de Jesus Cardinal Lopez Rodriguez said that he had ?no right to speculate? what the government might be proposing. The nation?s highest-ranking Catholic cleric added that he would withhold further comment until he had ?the facts? in front of him. President Hipolito Mejia was quick to offer assurances that what he would propose is just a ?mini-packet? and not a ?maxi-packet? of new taxes. The President spoke to reporters following an hour long meeting with leaders of the opposition PRSC party. The meeting, which Mejia described as ?cordial,? is part of the round of consultations on which he has embarked in pursuit of consensus for his economic proposals. Unanimity of opinion is not yet assured, however. A powerful business group is insisting on a reduction in income tax, something not heretofore mentioned in government circles. Speaking for the National Free Enterprise Council, Celso Marranzini, its President, had harsh words for Mejia, reminding him of his campaign promise not to raise taxes. Marranzini was especially hostile to the proposed 2.5% tax on wholesale goods which, he said, came as a complete surprise. Taken together with the proposed selective taxes on non-essential items, such as liquor and tobacco, the measures would bankrupt many businesses, he said. He also referred to earlier discussions with Congress concerning a 2% increase in the 8% ITBI (value added, point-of-sale) tax. Nevertheless, talk of a further increase to 14%, was never before hinted. Countries with higher ITBI taxes have much lower customs duties, said Marranzini, adding that the DR?s top rate of 35% ought to be reduced to 20%. The President of the National Businessmen?s Union echoed this position. Andres Dauhajre said that his group favored an increase from 8% to 12% in the ITBI tax, conditional on a reduction in the customs duties to 20% maximum. He also urged a reduction of the income tax to 10%, and argued that the proposed wholesale tax should be collected monthly, rather than annually as the government is proposing. Antonio Espin, President of the Herrera Industrial Association, warned of the severe impact on the economy that would be caused by the tax legislation being proposed. Espin criticized the government which, he said, speaks of support for the productive sectors, but only thinks about increasing its income without considering the impact on those sectors. Instead of raising the ITBI tax and imposing a new wholesale tax, the government ought to eliminate the currency exchange tax, the export fees charged by consular offices, the distortions and irregularities in the customs offices, and reduce bank interest rates. The Dominican Association of Exporters? President announced that his organization opposes the proposed ITBI increase. Juan Barcelo favors a broadening of the range of goods and services subject to ITBI, and the reform of the duty collection processes of the Customs Department.
