President Luis Abinader today promulgated the amendment to the law of Proindustria, which seeks to increase the competitiveness of domestic industry, strengthen the value chain and stimulate domestic exports through a series of measures aimed at the renewal and modernization of the national manufacturing sector.
This new law modifies articles 4, 9 and 17 of law 542-14 on Innovation and Industrial Competitiveness and from now on, the tax incentives provided for in it will be extended for 15 years, According to a statement.
It also corrects tax distortions, will make it easier to produce, will stimulate exports from local industry, will allow the compensation of the payment of the tax on the transfer of goods and services (ITBIS) and will facilitate the productive chain between the industrial sector. and free zones, which will have to translate into higher sales of local industries to free zones installed in the country that to date import more than US $ 3.6 billion annually in inputs for production.
President Abinader signed the document and delivered copies to employers in the Dominican Republic’s industrial sector.
This new law seeks to sustain competitiveness and motivate innovation in local micro, small and medium-sized enterprises to achieve the positioning of domestic production in international markets, the note details.
Incentives of the law 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 it allows to discount the investment in new machinery in the fiscal year of the previous year up to 50% of net taxable income, Also allows you to hire international consultants in the field of innovation without withholding of ISR taxes) international consultant i import raw materials, machinery and capital goods by paying only 50% of the ITBIS to the General Directorate of Customs (DGA).
This piece of legislation will be a tool to encourage production in the country, providing the necessary conditions for to promote modernization and renewal in the national industry through the correction of fiscal distortions that limited the competitiveness of our productive sectors.
In this sense, the text specifically indicates the types of raw materials, machinery and capital goods the renewal and modernization is encouraged, also preventing the benefits provided for the industrial sector are channeled and used for other purposes.
This law seeks to motivate production throughout the Dominican industrial sector, highlighting the sectors of food and beverage, construction, cosmetics, plastics, pharmaceuticals, among others, which will be able to benefit from these incentives from the date.
The enactment of this law occurs as part of the decree 588-20 declaring industrialization as a national priority, Articulated with actions from the Ministry of Industry, Trade and SMEs (MICM), as a key piece in the reactivation of the Dominican economy, after the effects of the Covid-19.