Santo Domingo. The general director of the Dominican Institute of Civil Aviation assured that the law of promotion and competitiveness of civil aviation promulgated by President Luis Abinader will revolutionize the country’s aeronautical sector and create better conditions to strengthen tourism development and lower the price of air tickets.
Héctor Porcella explained that Law 57-23, which creates a tax incentive regime for national and international civil aviation, will make the Dominican Republic one of the most attractive destinations for international investment, contributing to boost the economy and create new jobs.
He said that the tax incentive regime for commercial aviation aims to improve the competitiveness of the aeronautical sector, promote sustainable growth in the arrival of visitors by air and establish new domestic and international routes to and from strategic markets in the country.
Main scope of the new law
Law 57-23, which creates a tax incentive regime for national and international civil aviation, establishes the following provisions:
(1) Total exemption from withholding tax on foreign income payments for the leasing of aircraft or aircraft engines and aircraft maintenance, repair services; engine parts and other aircraft parts.
2) Withholding of a single and definitive nature of only 5% of the tax for payments abroad for training and training of crew personnel by non-residents; Use and maintenance of computer programs and software related to the operation and insurance of the aircraft.
.
3) Exemption from payment of the Tax on the Transfer of Industrialized Goods and Services (ITBIS) on the sale of complete flights by Dominican operating companies to companies abroad (charter), as long as such flights originate abroad to the Dominican Republic.
4. Exemption from payment of Tariff and ITBIS on the importation of aircraft and other aircraft of subheadings 8802.30.00 corresponding to airplanes and other aircraft of an unladen weight exceeding 2,000 kg, but not exceeding 15,000 kg and subheading 8802.40.00 corresponding to aeroplanes and other aircraft, of an unladed weight exceeding 15,000 kilograms.
5) Exemption from payment of the Tax on Assets declared in the General Directorate of Internal Taxes (DGII).
The promulgation of the Act confers on the Civil Aviation Board the function of receiving applications and evaluating the files of companies interested in benefiting from the tax incentives of said regulations, as well as recommending to the Executive the approval for granting such benefits, subject to no objection from the Ministry of Finance.
The new regulations aimes at promoting the development of international civil aviation in the context of the guidelines drawn up by the International Civil Aviation Organization (ICAO), which contain the international standards, recommended practices and procedures governing the sector.