NewsWhore
03-30-2011, 05:00 PM
The business sector is reacting with caution to the concerns expressed by the International Monetary Fund (IMF) about the reduction of tax income. They believe that at a time when society is vulnerable to external threats, the government should not increase taxes. The presidents of the Industrial Association (AIRD), Ligia Bonetti and the National Organization of Commercial Enterprises (ONEC), Antonio Ramos, together with the economist Henri Hebrard all expressed this opinion in separate interviews with Diario Libre. At the same time, Arturo Martinez Moya, the president of the PRD economic commission said the IMF recommendations were unacceptable, since they implied a greater tax pressure on the companies and the families with these new taxes. He is also against any increase in the electricity rates.
The AIRD president said that the IMF concern about reversing the ratio of tax collections-to-GDP should not generate concern that the government will take the route of increasing taxes. She said that the government would not do this at a time when the Dominican society feels vulnerable to external threats and there is evidence for the need for the productive sector of tradable and exportable goods to be pushed to the maximum with the aim of reducing the current accounts deficit and the trade balance. Ramos said that the right way to increase the ratio of tax collections-to-GDP was through more efficient tax collections, as they have been doing, and therefore he believes that the tax base should be expanded to better distribute the tax burden and increase the tax pressure in sectors where it does not exist. He said that an indiscriminate tax increase could well lead to bankruptcy in sectors of the economy that cannot bear any more fiscal loads. He referred to the fact that the crisis affects citizens as well as the government.
Hebrard said that the tax burden decreased a little more than 3% from 2007 to 2010, going from 17.31% to 14.04%. This is nearly a 19% decrease. But 2007 was the best tax collection year in history and should not be taken as a reference since it included the sale of Codetel and the fiscal amnesty. He said that the apparent fall in the tax pressure from last year is due to items affected by the economic crisis such as the consumption tax (ITBIS in the DR), the taxes on foreign trade, the tax on company earnings and the lower level of personal taxes that was joined by the non-indexation of hydrocarbons (fuels). On the question of the electricity rate increase, Ramos said that what was needed was an improvement in collections, which would focus on the subsidies, while the AIRD expects the productive sector to be consulted.
More... (http://www.dr1.com/index.html#11)
The AIRD president said that the IMF concern about reversing the ratio of tax collections-to-GDP should not generate concern that the government will take the route of increasing taxes. She said that the government would not do this at a time when the Dominican society feels vulnerable to external threats and there is evidence for the need for the productive sector of tradable and exportable goods to be pushed to the maximum with the aim of reducing the current accounts deficit and the trade balance. Ramos said that the right way to increase the ratio of tax collections-to-GDP was through more efficient tax collections, as they have been doing, and therefore he believes that the tax base should be expanded to better distribute the tax burden and increase the tax pressure in sectors where it does not exist. He said that an indiscriminate tax increase could well lead to bankruptcy in sectors of the economy that cannot bear any more fiscal loads. He referred to the fact that the crisis affects citizens as well as the government.
Hebrard said that the tax burden decreased a little more than 3% from 2007 to 2010, going from 17.31% to 14.04%. This is nearly a 19% decrease. But 2007 was the best tax collection year in history and should not be taken as a reference since it included the sale of Codetel and the fiscal amnesty. He said that the apparent fall in the tax pressure from last year is due to items affected by the economic crisis such as the consumption tax (ITBIS in the DR), the taxes on foreign trade, the tax on company earnings and the lower level of personal taxes that was joined by the non-indexation of hydrocarbons (fuels). On the question of the electricity rate increase, Ramos said that what was needed was an improvement in collections, which would focus on the subsidies, while the AIRD expects the productive sector to be consulted.
More... (http://www.dr1.com/index.html#11)