Today, President Luis Abinader enacted an amendment to the Proindustria Law, which aims to increase the competitiveness of the national industry, strengthen the value chain and stimulate national exports through a series of measures aimed at renewing and modernizing the national production sector.
This new law amends Articles 4, 9 and 17 of Law 542-14 on innovation and industrial competitiveness and from now on, the tax incentives provided for in the same will be extended by 15 years, according to a statement.
It will also correct fiscal distortions, facilitate production, stimulate local industry exports, allow the offsetting of the payment of goods and services transfer tax (ITBIS) and facilitate the productive chain between the industrial sector and free zones, which should translate into in higher sales of local industries to established free zones in the country, which so far import more than $ 3.6 billion annually in inputs for their production.
President Abinader signed the document and gave copies to businessmen in the industrial sector in the Dominican Republic.
This new law aims to support competitiveness and motivate innovation in local, small and medium-sized micro-enterprises to achieve the positioning of domestic production on international markets, the note states.
Law incentives to skilled industries
This law, on competitiveness and industrial innovation, will allow industrialists to reinvest their profits and deduct them from the payment of income tax, ie allows to reduce the investment in new equipment in the previous year’s fiscal year to 50% of net taxable income, also allows the employment of international consultancy in the field of innovation without withholding income tax (income tax) international consultant and import of raw materials, equipment and capital goods paying only 50% of ITBIS to the General Directorate of Customs (DGA).
This legislation will be a tool to encourage production in the country, providing the necessary conditions for promoting modernization and renovation in the national industry by correcting the fiscal distortions that have limited the competitiveness of our productive sectors.
In this respect, the text specifically indicates the types of raw materials, machinery and capital goods whose renewal and modernization are encouraged, while also preventing the benefits envisaged for the industrial sector from being channeled and used for other purposes.
This law aims to motivate production throughout the Dominican industrial sector, highlighting the food and beverage, construction, cosmetics, plastics, pharmaceuticals, among others, which will be able to benefit from these incentives from now on.
The promulgation of this law takes place as part of Decree 588-20 which declares industrialization as a national priority, articulated with actions of the Ministry of Industry, Trade and Mipymes (MICM), as a key element in the reactivation of the Dominican economy, after the effects of Covid-19.