The Internal Revenue Establishes a Special Tax System to Support Organized Banana Growers in Montecristi

The Internal Revenue Establishes a Special Tax System to Support Organized Banana Growers in Montecristi
Dominican Republic, Santo Domingo, December 10, 2012

Through an agreement that was signed this past Monday at the DGII headquarters, it was agreed to establish a Simplified Tax Procedure for this taxpaying sector.

“This agreement enables us to pay taxes, because we want to pay taxes, not evade them; but we want to pay taxes to stay organized in the marketplace, where the risks inherent to our business activities are being recognized,” …

The Directorate General of the Internal Revenue (DGII for its acronym in Spanish) signed a cooperation agreement with the organized banana producers in the Northwest part of the country,toestablish a Simplified Tax Procedure that would enable this agricultural sector to pay taxes with ease and to get up to date with their overdue taxes.

The agreement will only benefit the members of the Ramón Antonio CruzFarmersAssociation, of Hatillo Palma in Guayubín, Montecristi. It was signed by the DGIIdirector generalGuarocuya Félix, and the president of the farmers’ association, Mr. Tulio Federico CruzRegalado,during a ceremony that took place at the headquarters of the Internal Revenue. The banana association was also represented at the signing ceremony by Messrs. Albert Klemenz Ulrich, a Swiss national and member of the association, and Simeón Ramírez, advisor.

The leaders of the banana producers association of Guayubín highlighted the contribution thatthe agreement reached with the DGIIwill make to their strengthening, as the country’s banana production is very risky due to environmental circumstances and climateconditions, making banana cultivation highly risky as production dwindles, and, therefore, leaving very little benefits.

Producers also appreciated the effort made by the Directorate General of the Internal Revenue to establish a Simplified Tax Procedure, since not having an organized accounting system involves another great risk for the banana producers because they are unable to separate investment from benefits. The DGII, through the informationreporting systems that have beenimplemented, has data that allows the identification of the highest percentage of income of the members of the banana sector.

“This agreement enables us to pay taxes, because we want to pay taxes, not evade them; but we want to pay taxes to stay organized in the marketplace, where the risks inherent to our business activities are being recognized,” said SimeónRodríguez, advisor to the Antonio Ramón Cruz, Inc. Farmers Association(ASOARAC).

The Simplified Tax Procedure thathas been specifically designed for this sector provides that the Income Tax will be calculated by applying the tax exemption and the tax scale for individuals on the Net Taxable Income resulting fromlowering the taxable income in the percentages permitted as allowed deductions. The percentages permitted as allowed deductions shall be 96.10% for 2008, 94.48% for 2009, 94.83 for 2010, and 95.14% for 2011.

Spearheading the first cooperation agreement with the agricultural sectors that the current administration has signed, Guarocuya Félix, Director General of the Internal Revenue, said that the agency is committed to facilitating the fulfillment of their tax obligations by taxpayers, especially bya sector that, due to its informality, requires the establishment of simplified tax procedures to comply with its obligations.

The agreement established that banana growers for whomthe Simplified Tax Procedurewas established are not subject to submitting information on their tax receipts as established in the General Standard 01-07, which are covered by Regulation 758-08. In addition, the 2008 period will be deemed asexpired for those taxpayers who to date have not yet presented their affidavit of this year, unless there is an interruption in the expiration, as stipulated in Article 23 of the Tax Code.

The agreement also provides that the penalties that may arise from the legalization of their tax status by the banana producers for the years 2008 to 2010 will not be considered by the DGII.