½ûÂþÌìÌÃ

This is a very good question.  It seems everytime you pay the government, Dominicans call it a tax.  I'll give you an example.  We imported our household stuff and a car.  Since my wife is a Dominican, she gets a one time move back with an import fee exemption on the household items and 50% relief on the car import fee.  To do the car, I had to transfer ownership to my Dominican wife.  This took a form letter by a Dominican Lawyer, a tax (300 pesos) at some government building, then to another government building to get the document recognized and approved.

Following.

Taxes here are complicated in theory and worse sometimes in practice.

First point is that the law here is territorial. If your feet are on the ground the law applies to you.

Income tax: IF you have earned income, regardless of where from,  you are taxed here.   It is normal to be taxed at source.  Contractors or self employed have to register and pay their  income taxes.   IN practice most expats who  earn money online never report it. Its illegal but common.

Pensions are not taxable!

Property taxes - not payable on the first  US 174,000 of  value of your home.  That number is adjusted  for inflation.  Over that you are responsible for going and finding out what your tax payment is and making it. No idea who or how value is assessed.

Corporate taxes -  are complicated and stupid.  Get an accountant.

Payroll taxes - are also complicated for no reason.  We deduct and we withhold as an employer and remit on behalf of employees. For employees their portion is about 5% and employers pay about 15%

ITBIS - our value added tax, it's paid on almost everything.  Most places post  the cost including taxes. It ranges from 16% to 18%. very few items are excluded.

ITBIS is applied at all restaurants who are legal. 

For corporations ITBIS flows through and the corporation remits the  balance and files monthly. Again another stupid system as each end has to report the transaction, if appropriate.  I believe they are moving to automate this.

There are numerous tax agreements between countries. 

FYI  I hate taxes. 😂😂

@planner

Ditto

I said this over a year ago that things would start to go pro America.  I have no interest in stating whether it is right or wrong.  With Covid under control, other countries are starting to offer digital nomad visas without taxes on foreign income whether you are a resident are not.  They do not tax corporations either. Americans spend, spend, spend. They realize that the loss of the income generated by Americans has caused a severe deficit.   We spend on gas, dinning out, groceries, lunches, pools, travel, Amazon, nightlife, and partying. I love the Dominican Republic and I've made some lifelong friends, but the climate in the US right now for African Americans is tenuous at best.  I'm looking to move, work remotely with my American Salary, without the tax on Global income.  When will the DR step up?

As far as I see there is no interest here in stepping up.   the rational that Americans or any expats spend spend spend is not a justification for not paying taxes of some kind.     Almost everyone who lives here spends on living. ALL of us spend to exist,  rationalizing one group of people not paying taxes is ridiculous.

@Michael C Mitchell Sr.

At least the U.S. gives you a break on foreign earned income! I think it’s up to $130k this year.

Income sourced from the country is fine.  My problem is with Global Income tax on personal and corporations.  Tax residents. Everything service I use in the Dominican Republic is taxed.

There are 16 countries that do not tax global income, 4 do not tax corporations as well.

This is not an attack on the DR, just an observation of a growing trend in the world and my fear is that the DR will be left behind. 

The law in DR is territorial and based on french law.  So if your feet are on the ground the laws apply, this taxation on earned income regardless of where it's from. 

And sorry I disagree with everything you use is taxed.  So really your taxes cover roads?  Policing?  I can go on and on. 

There is no breakdown of where the taxes go when I use a service. If I travel to the DR, what you are saying none of the taxes are applied to Policing, etc???

What I am trying to say is taxes are hidden.  No one knows where those taxes go.

What should be done are fees. Fees are more palatable and can be levied on the expat, and not the non resident corporation.

An Infrastructure Service fee, Health and Protection service fees, and Cultural and Language fees to maintain the DR's culture would make most foreign companies and expats happy.

There's a fire station in Sousa.  It has been years and it is still being built.  Fees are explicit and I would pay them without question because I know exactly what they are for.  With Covid all but gone, countries have reintroduce digital nomads without taxes on global income.  The Bahamas has already done so, with the Philippines following them.

And what I am saying is WHY should a group of  expats who work for a living evade Dominican laws and not pay income taxes like the rest of the people who live and work here!

"An Infrastructure Service fee, Health and Protection service fees, and Cultural and Language fees to maintain the DR's culture would make most foreign companies and expats happy."

I do not know ANY country that breaks down basics into fees.  You are asking the DR to do what no one else does. 

And they do not exist to make EXPATS happy.  You are a guest in this country.   If you don't like it you are free to go to the Bahamas or Philippines!

Can anyone here say that, in their home country, they...

.... fully understand and approve of the tax system?

... never use a service that someone else has paid for?

... never pay for a service that someone else uses more than they do?

I couldn't say "yes" to any of those.

In many cases, when working abroad and not paying taxes there, you will still  be taxed on that income in your homecountry and that might be worse.

Two certainties in life: taxes and death.