The PLD legislators passed the tax reform as received from the Senate in less than five minutes without changes yesterday, Thursday 8 November. Today’s El Dia comments that some legislators even asked what had been approved.
According to reports the bill is being rushed through because the International Monetary Fund has asked for it to be ready before 10 November and the National Budget approved before 15 November. IMF representatives are in Santo Domingo for talks expected to lead to the review of the most recent stand-by arrangement and the signing of a follow-up agreement that will provide additional resources for the Medina administration.
The bill seeks to provide the Medina administration with an additional RD$46 billion. The legislators voted 103 in favor, 66 against and five did not vote. The deputies voting against included Victor (Ito) Bisono (PRSC), Guadalupe Valdez (APD), and 64 of the PRD. Sonya Abreu de Romero, Hugo Tolentino Dipp (PRD), Minou Tavarez Mirabal (PLD), Marino Hernandez and Eduardo Hidalgo (PLD) abstained.
Senate president Reinaldo Pared Perez told the press that President Danilo Medina would modify or leave without effect any tax included in the reform. He said this occurred three years ago when the government revoked the application of an increase in the selective tax on beer, as reported in El Dia. Included in the bill is an article that requires Internet purchases under US$200 to be subject to Customs procedures, a provision that is said to be in violation of the DR-CAFTA trade agreement.
The measures approved include an increase of the sales tax (ITBIS) from 16% to 18% on most articles. Food items that had not been taxed, including sugar and coffee, will now be subject to tax.
A 1% tax on people’s total real estate assets is assessed. Up till now any property under RD$5 million had not been taxed. The total taxation level is now at RD$6.5 million.
The ad valorem tax on avtur (airline fuel) was reduced from 8 to 6.5%.
Informal businesses need to pay a RD$12,000 annual tax if they source materials for more than RD$50,000 a month.
A RD$2 increase on each gallon of fuel to fund road infrastructure and public transport is included. In addition there will be a CO2 emissions tax, apart from cargo trucks and public transport for more than 16 passengers.
www.acento.com.do/index.php/news/23497/56/Diputados-aprueban-el-paquetazo-para-que-los-pendejos-paguen-impuestos.html
www.senado.gob.do/senado/Inicio/tabid/40/ctl/ArticleView/mid/439/articleId/976/Senado-Aprueba-En-Dos-Lecturas-Consecutivas-Proyecto-Reforma-Tributaria.aspx
http://www.imf.org/external/np/fin/tad/exfin2.aspx?memberkey1=260&date1Key=2012-10-31