NewsWhore
11-17-2006, 02:30 PM
The fiscal reform that President Leonel Fernandez officially announced in his speech on Tuesday is slowly being modified. This is not a surprise since Presidency Technical Secretary Temistocles Montas was quoted in yesterday's Diario Libre as saying that some taxes that are considered unsuitable will be replaced. Listin Diario writes that Finance Minister Vicente Bengoa announced that instead of taxing insurance with ITBIS (VAT), it has been decided that the selective tax on insurance will be increased from 10% to 16% because, according to Bengoa, it is a quicker way to collect money since there are no deductions. It has also been announced that the 119 products that had been excluded from ITBIS during the last fiscal reform will now be taxed at 16%. El Caribe newspaper says that as a result, a pound of coffee in the "colmados" will rise from RD$85 to RD$98.60, margarine from RD$40 to RD$46.40, white sugar from RD$18 to RD$20.88 and unrefined sugar goes from RD$13 to RD$15.08. Chocolate will increase from RD$190 for a box of 60 bars to RD$220.40, and a gallon of yogurt goes up from RD$150 to RD$174.
The draft version of this reform will be given to the President today for revision.
Bengoa has defended the fiscal reform and tried to calm the tourism sector by saying in Diario Libre that the reform will not hurt competition, since hotel rooms will now be subject to a 5% tax, explaining that this particular tax only amounts to US$20 million for an industry that makes more than US$3 billion.
The reform is expected to reach Congress before 15 December so that it can be reviewed alongside the sixth review of the Stand-by agreement with the IMF, which is set for 22 December.
Moises Pineda, the Inter-American Development Bank representative in the DR, is quoted in El Caribe newspaper as saying that it will inevitably affect the poor, and asked the country's legislators to take that into account while reviewing the reform. Moises Pineda is also quoted in Listin Diario as saying that many sectors of society will be affected by the reform, but that if it isn't carried out now the economic distortions will continue. Pineda says that the reform will allow the country to take advantage of the economic resources, and explained that the government must avoid new modifications each year. Pineda also reminded the public that the final outcome will be decided by Congress, meaning that they could approve the reform as it stands, or ask for there to be more revisions.
More... (http://www.dr1.com/index.html#1)
The draft version of this reform will be given to the President today for revision.
Bengoa has defended the fiscal reform and tried to calm the tourism sector by saying in Diario Libre that the reform will not hurt competition, since hotel rooms will now be subject to a 5% tax, explaining that this particular tax only amounts to US$20 million for an industry that makes more than US$3 billion.
The reform is expected to reach Congress before 15 December so that it can be reviewed alongside the sixth review of the Stand-by agreement with the IMF, which is set for 22 December.
Moises Pineda, the Inter-American Development Bank representative in the DR, is quoted in El Caribe newspaper as saying that it will inevitably affect the poor, and asked the country's legislators to take that into account while reviewing the reform. Moises Pineda is also quoted in Listin Diario as saying that many sectors of society will be affected by the reform, but that if it isn't carried out now the economic distortions will continue. Pineda says that the reform will allow the country to take advantage of the economic resources, and explained that the government must avoid new modifications each year. Pineda also reminded the public that the final outcome will be decided by Congress, meaning that they could approve the reform as it stands, or ask for there to be more revisions.
More... (http://www.dr1.com/index.html#1)