President of the Association of Authorized Public Accountants of the Dominican Republic, Inc. Says there is no Reason to Fear the Application of the New ISR Tax Established by Law 139-11

President of the Association of Authorized Public Accountants of the Dominican Republic, Inc. Says there is no Reason to Fear the Application of the New ISR Tax Established by Law 139-11
Santo Domingo, Dominican Republic July 16, 2011

It is recommended that every tax payer solicit a consultation at the DGII (Internal Revenue Service) to confirm that the application of the new law will only correspond to the fiscal closure covering March 31 for 2011 and 2012, as established by law.

“When one has had this consultation, as we have for our own clients, the Tax Administration Office will establish, in its response, a tax level for the close of March 31, 2013 which will be around 25%, …”

The president of the Association of Authorized Public Accountants of the Dominican Republic, Inc. said there should be no fear on the part of any business person with regards to the application of the new Income Tax measures, established by Law 139-11, given that the same Law establishes a 2-year validity period, a criteria confirmed by the GGII.

This, said the president of the Association of Authorized Public Accountants, will provide assurances to the productive sector of the nation, especially those affected by the interpretation of the fiscal deadline of March 31, 2011.

Pedro Urrutia, auditing and tax consultant, recommended that people remain calm in that taxpayers only need to set up a formal consultation with the DGII to look at the years of application of the new tax measures. He said the Tax Office will guarantee, in writing, that the 29% of ISR will be applied to the deadlines of March 31, 2011 and March 31, 2012, avoiding any misinterpretation of the closure of the fiscal year corresponding the March 31, 2013. This guarantees that the discussion that has been going on recently makes no sense, given that Law 139-11 establishes its validity for these 2 fiscal years, starting with 2011.

“When one has had this consultation, as we have for our own clients, the Tax Administration Office will establish, in its response, a tax level for the close of March 31, 2013 which will be around 25%, because the same Law establishes that for two years of its validity, returning for the fiscal closure of March 31, 2013, taxes will return to 25%,” said the tax expert and founding member and director of Urrutia Liriano & Associates.

He added that everyone wants to pay taxes with the new levels as established by law, while having the confidence that it will be done for the two fiscal years as established under the Law, and this is what the DGII has fully guaranteed.

“Law 139-11 establishes a validity of two years. The concern of taxpayers is that the DGII will retroactively apply the fees, as was decided, to their March 31, 2011 tax returns and that they will be paying it for three tax periods, that is to say, March 31, 2011, March 31, 2012 and again March 31, 2013. However, this last date, although the law is in effect, the 29% tax fee is not applicable because its validity runs for two years,” explained Urrutia.