President Leonel Fernandez said yesterday that the 25% tax on corn syrup imports should be eliminated to avoid becoming an obstacle to the free trade agreement with the United States. Fernandez was speaking at the Dialogue Work Shop for the Preparation of the Strategy and Agenda of the Electronic Government 2005-2008 that is taking place today at the Hotel Jaragua. The conference aims to consider the use of the Internet in making the state more efficient, productive and transparent.
The corn syrup surcharge was introduced as part of the tax reform approved by Congress in September.
At the same event, Foreign Relations Minister Carlos Morales Troncoso reaffirmed the notion that the tax is creating a tempest in a teapot. “Corn syrup is a small business worth US$10 million [annually], but the country buys more than US$200 million in corn,” said Morales Troncoso. As reported in Diario Libre, President Fernandez sent the Senate a proposal to modify the tax reform bill to eliminate the corn syrup tax, but legislators have yet to study the bill.
Assistant Secretary of State for Western Hemisphere Affairs Roger Noriega, in a 15 November interview with the Washington File distributed by the United States government news agency, says that the approval of the DR-CAFTA is being “sorely complicated” by the Dominican Republic’s decision to impose a tax on US products made with high-fructose corn syrup. He indicates in the interview that the United States is trying to rectify the issue and predicted that once it is resolved, the accord will likely be presented to the US Congress for consideration in early 2005. The prospects for approval of the accord, he said, are “probably pretty good.”