2003News

Tax reform and tax evasion

El Caribe reports that the tax reforms requested by the business and industrial community would focus on the ITBIS and would either raise the rate or extend the consumer tax to yet more articles. The businesspeople also suggested raising the taxes on license plates and real estate, as well as other internal taxes. This was the position of the Industrial Association of the Dominican Republic, CONEP and the National Association of Importers, who met last week with Rafael Calderon, the Finance Minister. One of the proposals made last year was to reduce the ITBIS (a value-added tax) to 9% from the present 12%, and collect it universally on every item sold in the country. Hoy’s Aleida Plasencia reports that many businesspeople feel that higher taxes will only stimulate further tax evasion by those hardest hit. Ignacio Mendez commented that if the government were to collect 75% of the taxes that were being dodged, there would be no need to reform the tax laws.