In recent years, the Dominican Republic has positioned itself as a beacon for foreign investors, offering a myriad of tax benefits, incentives and capital gains that make it an irresistible investment destination. Unlike many other countries, the Dominican Republic does not impose the hefty 30% tax on property purchases, allowing homeowners to save significantly. This favorable tax environment, coupled with various incentives, creates an optimal investment climate, enabling investors to maximize their returns.

The real estate industry has been promoted significantly by several government measures to stimulate tourism and give significant tax incentives to the investors on Tourist Development Promotion. The goal is to develop the tourism industry in a reasonable and sustained manner, by offering investors several tax incentives. It is worth to highlight the tax exemption for 10 years of 100% on the taxes for income, capital gain, company incorporation and capital increase, real estate transfer and real estate property.  Such law exonerates 100% of custom taxes or goods importation taxes, movables estates, equipment and those material needed for building and setting up the real estate facilities purchased.

According with Law 171-07 on incentives to retired people and foreign source renters, the real estate investors can obtain a resident permission in 45 days.

Tax incentives include:  Law No. 16-95: On Foreign Investment, where the Dominican State recognizes that foreign investment and technology transfer contribute to the economic growth and social development of the country;   Law No. 84-99: On Reactivation and Promotion of Exports whose interest of the State is to establish new mechanisms and modernise existing ones in order to promote a reactivation and sustained expansion of exports of goods and services;  Law No. 8-90:  Promotion of the Free Trade Zones of Exportation. This law exonerates all the taxes of exportation, import, re-export, of all the goods and services necessary to perform different types of activities. Law No. 56-07: Declares the sectors belonging to the textile, clothing and accessory chain as a national priority; skins, manufacture of footwear and leather and creates a national regulatory regime for these industries which includes the exempt from payment of the Tax on the Transfer of Industrialized Goods and Services (ITBIS) and other taxes; Law No. 480-08: On International Financial Zones. The purpose of this Law is to create the legal framework for the establishment of International Financial Zones in certain geographical areas. In 2010, the DR Government promulgated the Law for the promotion of cinematographic activity (Law 108-10), which provides various tax incentives for the development of this economic activity.

The Dominican Republic offers numerous opportunities for foreign investors and international businesses looking for new opportunities. We believe the domestic business environment in dynamic and ever evolving for the better. For a more in-depth discussion about investment opportunities and doing business in the Dominican Republic, contact us on +1 807-770-0290

REFERENCE: https://www.hlb.global/3-reasons-why-you-should-invest-in-the-dominican-republic/