Experienced tourism industry researcher, Juan Llado understands the time has come for Dominican tourism investments to get along without the generous tax incentives that have marked the development of the sector over the past decades.
The Law for the Promotion of Tourism Development exempts tourism businesses from paying income tax or taxes on equipping.
Now Lladó says that due to the sustained growth experienced by the tourism sector, the generous tax exemptions are no longer necessary. He says multilateral organizations for years have recommended cutting back on the generous tax incentives.
“If you are a foreign investor and you want to develop a project, you will feel good about getting 15 years of tax exemptions, but that is not necessary,” says Llado. “There is a 1991 study by the OAS on existing incentives in the Caribbean region, and the conclusion is that they are not necessary,” he remarks in the interview in Hoy.
“Moreover, multilateral agencies have been asking for this for decades, the International Monetary Fund, the Inter-American Development Bank, the World Bank, all have said that these incentives are not necessary to stimulate investment,” he said.
Llado says that tourism ventures have more than 20 years under the exemption regime while reporting losses to the Tax Agency (DGII).
The Abinader administration has continued the policies of the previous governments for generous support to the tourism industry for its multiplier effect on the economy.
Hoteliers, in turn, say that the incentives are what make them competitive.
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Hoy
30 August 2022