The Abinader administration has yet to deposit in Congress its proposed fiscal reform. Meanwhile, generalities of what is coming are being socialized with the general public.
Hacienda Minister Jose Manuel (Jochi) Vicente has been promoting the need for tax reform, arguing that significant public spending increases are necessary to improve living standards and public services. Vicente describes the tax proposal as one that calls for broad-based participation, will protect the vulnerable, promote tax equity and combat tax evasion.
Speaking at the American Chamber of Commerce’s monthly luncheon, Vicente said the additional resources collected through the tax reform would be used in key areas such as public safety, transportation, and primary healthcare. He emphasized that the increased expenditures should be funded through revenue generation. “Even churches need to contribute,” said Vicente.
Addressing the American Chamber of Commerce, Vicente emphasized the need for substantial increases in public spending to meet the growing demands of the population. However, he cautioned against continuing the practice of covering current expenses and capital investments solely through borrowing, as this could jeopardize the country’s economic stability.
“The additional revenue generated from a tax reform would be strategically allocated to critical areas such as law enforcement, infrastructure, and primary healthcare,” Vicente stated.
Vicente said the government has prepared a comprehensive fiscal reform proposal that includes the elimination of certain tax incentives. The move, he said, aims to balance the tax burden and increase government revenue by over RD$110 billion.
During the American Chamber of Commerce of the Dominican Republic (AmchamDR) lunch, Vicente emphasized the need for a more equitable tax system. He stressed that the reform would target tax evasion and ensure that all sectors of the economy, including businesses, consumers, and even religious institutions, contribute their fair share.
“We found exemptions that I didn’t even know existed,” Vicente remarked, highlighting the need for a thorough review of the tax code.
The minister noted that the Dominican Republic has one of the lowest public spending rates in Latin America and the Caribbean. To address the country’s infrastructure, health care, and security needs, the government plans to increase capital spending from 2.7% to 5% of GDP.
Vicente expressed confidence that the reform would enable the government to make significant investments in critical areas such as health, security, and infrastructure.
The minister also addressed the importance of recapitalizing the Central Bank, a recommendation made by the International Monetary Fund (IMF). Vicente stated that this step is necessary to strengthen the Dominican Republic’s economic stability.
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Diario Libre
Noticias SIN
American Chamber of Commerce
26 September 2024