In a significant move to alleviate economic pressure on citizens, Dominican Finance Minister Dr. Irving McIntyre has declared the complete removal of Value Added Tax (VAT) on 26 essential consumer products. The announcement was formally made during a parliamentary session this week, marking a substantial fiscal policy shift aimed at direct public relief.
Minister McIntyre emphasized the government’s commitment to finding alternative revenue streams that do not disproportionately burden the population. “To avoid hardship on our people, we find ways other than through taxes to raise revenue and provide relief when required,” he stated. The extensive exemption list encompasses basic food staples and household necessities including salted herrings, codfish, various legumes (split peas, red kidney beans, black-eyed peas, lentils, pigeon peas), core grains (cream of wheat, cornmeal, oats, wheat bran cereals), canned protein products (luncheon meat, corned beef, herring, sardines, tuna, mackerel), unsweetened biscuits, orange juice, tomato ketchup, toothpaste, laundry detergents, toilet paper, and sanitary napkins.
Crucially, Dr. McIntyre highlighted that these items already benefit from zero import duties, creating a compounded reduction in consumer costs. He formally requested suppliers and retailers to fully transmit these fiscal benefits to end consumers, ensuring the policy achieves its intended effect.
The implementation of these measures requires a legislative amendment to Schedule II of the Value Added Tax Act, Chapter 67-8 of the 2017 revised laws.
In a related development, Dr. Vince Henderson, Minister for Foreign Affairs, International Business, Trade and Energy, reinforced the regional economic dimension of this policy. He strongly encouraged domestic importers to prioritize sourcing these goods from within the Caribbean Community (CARICOM), noting that member states possess the capacity to supply over 75% of these essential items. “Therefore, they should be protected,” Dr. Henderson asserted, confirming that CARICOM had granted the Dominican Republic’s request for a zero-rating period under the Common External Tariff (CET) framework. He revealed that only eight items on the exemption list are not sufficiently produced within the CARICOM region, presenting a substantial opportunity for regional trade expansion and economic cooperation.