The Supreme Court of Justice rendered its decision on the 5% tax on exports and the 10% surcharge on imports, as introduced by Presidential decrees 727-03 and 139-03 in response to the recent economic difficulties, declaring them both unconstitutional. The controversial taxes were met with active resistance from the business community, who took the matter to court in August.
In the case of the 5% tax on exports, the 16 judges ruled that such a surcharge could only be imposed and enforced by Congress and through legislation, and that its introduction by decree violated the first clause of Article 37 of the Dominican Constitution.
The 10% surcharge on imports was defined as a tax and therefore required to go through all proper legislative process. Any breach of the legislative process contravenes Article 46 of the Constitution.
The judges came to the conclusion that the President had no “legal capacity to impose new taxes or modify existing ones,” and therefore ruled both taxes null and void.
The decision is welcomed by an editorial in El Caribe, which calls it a bolster to the country’s judicial stability, and that it sets important precedents for the future. “The law and the Constitution must always be followed, above and beyond all opportunistic conveniences,” says the editorialist.