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Proposal for tax-free shopping up to US$200 in local stores

Over the last few years more and more Dominicans have been making the most of the lower cost of Internet purchases. It remains to be seen if people would be buying the same goods locally if the US$200 tax exemption on purchases did not exist. But now Ernesto Martinez, president of the National Organization of Commercial Businesses (ONEC), the association of mall and superstore owners in the Dominican Republic, is proposing that the government level taxation for local and online purchases alike. ONEC wants the government to eliminate sales and customs taxes on shopping in local stores for purchases up to US$200, as quoted in an interview published in Listin Diario today, Monday 14 October.

ONEC says that this would provide fiscal transparency for the shopping sector. The mall owners say that the present tax exemption for online purchases up to US$200 is unfair competition and they want equal treatment. They say they employ more than 862,000 people, and their costs reflect the higher local labor, store and taxation costs.

They refer to a study by the Economy and Development Foundation that shows that online purchases grew by 253% from 2009 to 2011. The Customs department says that courier companies declared imports on purchases under US$200 via the Internet for US$189.3 million in 2012.

Jose Burdie, president of the Dominican Association of Couriers (Adosec) says that online imports have been positive for the country. The increasing imports have created reasonably priced airlift for Dominican exports on the return flights.

Burdie estimated that around 65,000 locals buy online every month, or around 500,000 for the year. He told Diario Libre that the most popular purchases are clothing, footwear and technology.

The fiscal reform introduced at the start of the Medina administration proposed to tax Internet purchases but supporters were able to prove that the taxation violated the DR-CAFTA trade agreement and it was revoked.

Source: DR1,

Category: DR News |

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Last updated October 24, 2016 at 6:05 PM
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