NewsWhore
10-26-2009, 04:40 PM
According to the president of the Dominican Republic Industrial Association, Manuel Diez Cabral, the public debt could reach as much as US$24 or US$25 billion, nearly 50% of the nation's Gross Domestic Product (GDP). In his opinion, the foreign indebtedness could put the relatively stable macro-economic situation of the country at risk, and he said that the greatest danger is the lack of political will to change the economic model. Diez Cabral was speaking at a ceremony marking the 35th anniversary of the Dominican Traders Federation (FDC).
FDC president Ivan de Jesus Garcia said that the government should gradually phase out the 0.15% tax on checks and money transfers. He used the example of a million peso loan at 18%, which would pay RD$500 a day in interest. However if a supplier were to be paid one million by check, a RD$1,500 charge would be added, or the equivalent of three days interest. As a result, according to Garcia, this tax is forcing traders to use more informal commercial methods, since businesses that work on slender profit margins such as warehouses and distributors see RD$10 million in sales paying RD$15,000 in this tax, which is the cost of two employees. Garcia said that he and his group recognize the fact that in the face of the current decrease in government collections it is simply impossible to eliminate this tax, but that at least it should be removed over the next three years so that traders may operate with more transparency and fluidity.
In a further suggestion, Garcia pointed out that the Social Security fund will end the year with RD$100 billion, RD$70 billion contributed by the commercial sector and RD$30 billion from employees. He suggested that some of this money should be spent on constructing low-cost housing for employees who contribute to the SS. Finally, Garcia questioned the system of workers' severance pay and the fact that the banks are loaning money at 18% and 30% but are only paying 4% interest on certificates of deposit.
More... (http://www.dr1.com/index.html#3)
FDC president Ivan de Jesus Garcia said that the government should gradually phase out the 0.15% tax on checks and money transfers. He used the example of a million peso loan at 18%, which would pay RD$500 a day in interest. However if a supplier were to be paid one million by check, a RD$1,500 charge would be added, or the equivalent of three days interest. As a result, according to Garcia, this tax is forcing traders to use more informal commercial methods, since businesses that work on slender profit margins such as warehouses and distributors see RD$10 million in sales paying RD$15,000 in this tax, which is the cost of two employees. Garcia said that he and his group recognize the fact that in the face of the current decrease in government collections it is simply impossible to eliminate this tax, but that at least it should be removed over the next three years so that traders may operate with more transparency and fluidity.
In a further suggestion, Garcia pointed out that the Social Security fund will end the year with RD$100 billion, RD$70 billion contributed by the commercial sector and RD$30 billion from employees. He suggested that some of this money should be spent on constructing low-cost housing for employees who contribute to the SS. Finally, Garcia questioned the system of workers' severance pay and the fact that the banks are loaning money at 18% and 30% but are only paying 4% interest on certificates of deposit.
More... (http://www.dr1.com/index.html#3)