President Hipolito Mejia has forwarded the PLD tax proposal to the lower house of Congress, and, of course, all the interested parties have begun to emit opinions. The Listin Diario reported that Mejia submitted the new tax legislation that will modify the Tax Code, the taxes on luxury dwellings and urban lots, inheritances, donations and other aspects of different laws that produce income for the government. The new piece was handed to Alfredo Pacheco, the Chamber of Deputies leader, by Finance Minister Rafael Calderon. Pacheco said he would call for a review at once, and summoned the Chamber to meet today at 9am.
The PRD and the PRSC parties want to see a general pay raise included in the new legislation, according to Hoy, and the PRSC spokesperson said that his party had not been consulted in the deliberations leading up to the new proposal.
One of the first to cry out was Emilio Lapayese, in his column ?En solo 100 palabras? (In just 100 words) published in Hoy. He says that instead of punishing those who must live on rental income or interest from savings, they should first find all of the money that was allegedly taken from the banks, wherever it may be.
The Dominican Federation of Businesspeople (FDC) warned in another article that the tax reform as sent to Congress will produce at least a 10% inflation rate, and agreed with Lapayese in that the recovery of the RD$50 billion from the Baninter fiasco should be recovered at all costs. Ivan Garcia, the FDC president, pointed out that a group of 20 or 30 clients owe the bank approximately RD$30 billion.
The economic section of the Listin Diario carries the headline that the banks are warning that the proposed 15% tax on savings accounts will diminish savings and promote a drain of capital.
Likewise, the banks are worried that the elimination of the provision for banking confidentiality will erode confidence in the banking system itself. Jose Manuel Lopez Valdes, the president of the Dominican Banking Association (ABA), told reporters that, not only does the new legislation carry eminently fiscal overtones, it also creates distortions within the economy.