Senate approves bill for more taxes

[NewsWhore]

On Friday, the PLD-majority Senate passed a bill aimed at providing the Fernandez administration with the funds to cover its increasing fiscal deficit, a requirement for continuing the IMF Stand-by arrangement. The increased taxation is expected to collect an estimated RD$9.6 billion. The senators approved increasing income tax on companies from 25 to 27%, effective as of 2011. Also a 1.5 per thousand tax on cash withdrawals from banks, excluding cash withdrawals up to RD$20,000. Withdrawals from ATMs, consumption using credit cards and social security payments are exempt from this new tax, as well as transactions and payments for pension plans. There is also a new tax on the operation of casinos of RD$32,500 per table in the casino of those with a volume of up to 15 tables, RD$37,500 of those from 16-35 tables, and RD$50,000 for those with 36+ tables. Lotteries will pay RD$35,000 up from RD$31,000 and an additional 1% on sales or gross operations and RD$200,000 for initial registry. Betting stores will pay RD$225,000 annual operation tax in National District, Santo Domingo, San Cristobal, Santiago, Duarte, Puerto Plata and La Vega. Those located in other provinces will pay RD$150,000 a year. There will be a RD$500,000 registration fee and 1% tax on gross sales. Slot machines will pay 5% on gross sales, regardless of location. The government will not authorize new operation of lotteries or betting stores for 10 years. The government also ordered a 10% operation tax on telephone games, and 10% on Internet gaming for those authorized by the Ministry of Hacienda, regardless of location.

The senators also approved a tax of 2.5% on free zones sales in the local market. These taxes will be indexed to the consumer price index published by the Central Bank.

The bill now needs to be passed in the Chamber of Deputies, where the ruling PLD party also holds the majority.

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