DOMINICAN REPUBLIC Law and Practice Contributed by: Sarah de León Perelló, Elizabeth Silfa Micheli and Naomi Rodríguez Manzueta, Headrick Rizik Álvarez & Fernández
• ITBIS on the acquisition and import of inputs and raw materials used in the production of goods exempt from ITBIS in accordance with current tax legislation. • 50% of ITBIS on the acquisition and import of inputs and raw materials used in the production of goods which are not exempt from ITBIS in accordance with the current tax legislation. • Tariff on the import of inputs and raw materi - als used for the production of goods, only when they are not produced in the Dominican Republic. • Real estate transfer tax and other taxes related to real estate operations on the land and infrastructure where the classified project will be developed. • Taxes, fees and registration rights related to the capital gain and transfer of shares in companies with registered offices within the SBDZ. • Exemption from the obligation to withhold and pay to the Tax Department payments abroad for technological innovation services required by the classified project exclusively during construction and start-up. Tourism Development Under Law No 158-01 for the Promotion of Tour - ism Development, companies domiciled in the Dominican Republic that qualify to benefit from the incentives of such law are exempt from pay - ing: • income tax, as established under Law No 158-01; • national and municipal taxes charged for using and issuing construction permits, including the acts of land purchase, provided they are used as authorised by Law No 158- 01; and
• import taxes and other taxes, such as rates, rights, surcharges, including ITBIS that are applicable to the equipment, materials and furniture that are necessary for the first equip - ment and commissioning and the tourist facil - ity in question. Renewable Energy All projects of public, private or mixed facilities that generate energy from the following renew - able sources may benefit from the incentives provided in Law No 57-07 on Incentives to the Development of Renewable Energy Sources and its Special Regimes, as amended, upon prior approval, according to the procedure estab - lished by law: • wind farms with an initial installed capacity that does not exceed 50 MW; • hydroelectric facilities of which hydroelectric capacity does not exceed 5 MW; • electro-solar (photovoltaic) installations of any type and of any power level; • solar thermal installations (concentrated solar energy) of up to 120 MW of power per plant; and • facilities that produce energy from biomass up to a generated power capacity of 150 MW. The main applicable incentives for the renewable energy regime are: • an exemption from import taxes and VAT; and • a ten-year income tax exemption; and • a reduction of taxes on external financing: a 5% reduction of the tax for payment of inter - est from external financing, only in relation to interest payments to financial institutions. 5.4 Tax Consolidation Tax consolidation is available and can be requested by the interested party or declared
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