Government submits draft law on Fiscal Modernization and Tax Reform to Congress

Santo Domingo.- The Executive Branch, through the Ministry of Finance, submitted the Fiscal Modernization Bill to the National Congress, aiming to boost tax revenues to fund infrastructure projects, citizen security, health, and social protection. Finance Minister Jochi Vicente emphasized that the initiative targets national development rather than specific sectors or social classes. The bill will also increase allocations to municipalities for improved waste management and the construction of sidewalks and curbs to enhance citizens’ quality of life.

Vicente highlighted that achieving the country’s 2036 development goals requires collective contributions from all sectors. The proposed changes include the elimination of advance payments for individuals and micro-enterprises and the introduction of an 18% value-added tax (VAT) on non-essential goods, replacing the current industrialized goods and services tax (ITBIS). Essential items like bread, rice, chicken, milk, and other staples will remain exempt.

This initiative has been in preparation for over five years, predating President Luis Abinader’s administration, and seeks to position the Dominican Republic on a path to full development by the end of his term, providing better opportunities for its citizens.