Law 51-23 Amnesty Law
Approved on 2023 in the Dominican Republic.
Tax amnesty is a measure that some governments take to grant certain tax benefits to taxpayers who have outstanding tax debts or who have evaded taxes in the past.
These benefits may include the total or partial remission of fines, interest, and surcharges on tax debts, as well as the possibility of regularizing their tax situation without facing legal sanctions.
In the Dominican Republic, on August 14, 2023, the Executive Branch approved Law number 51-23, known as the “Tax Amnesty Law”, which establishes a special temporary treatment for the supervision, management, and recovery of tax debts.
This law aims to implement a special treatment until December 20, 2023, that includes the statute of limitations for tax debts, a simplified process of tax supervision, payment facilitation for tax debts and an amnesty for state tax debts.
According to the law, the following taxpayers will be subject to these benefits:
individuals, legal entities, state entities, entities without legal personality and undivided successions that have tax debts prior to 2015, tax supervision processes in progress at the time of the enactment of the law, declarative or presentative tax debts from years after 2016 and up to 2021, and tax debts of state institutions related to withholdings not paid to the General Directorate of Internal Taxes (DGII).
The treatment for the ex officio statute of limitations implies that tax debts prior to 2015 reflected in the taxpayer’s current account will be declared as statute of limitations. To benefit from this, the taxpayer must meet certain requirements, such as being up to date in the filing of tax returns and payments from 2016 onwards and not being subject to criminal proceedings or tax audits.
Regarding the abbreviated supervision procedure, taxpayers that are being audited for ISR or ITBIS in a desk supervision process at the time of the enactment of the law may request this procedure. However, some taxpayers are excluded from this option, such as those under external audit or criminal tax investigation.
To determine the ISR in the abbreviated procedure, the average of the Effective Tax Rate (TET) of the fiscal years 2019, 2021 and 2022 is used. For ITBIS, 70% is applied on the average TET of the fiscal periods of January 2019, 2021, and 2022.
The law also establishes payment facilities for tax debts from 2016 to 2021, allowing the payment of 70% of the assessed taxes without late payment surcharges or indemnifying interest in certain cases.
In addition, tax amnesty benefits are granted to withholding agents that have income tax and ITBIS tax debts not paid to the DGII until August 1, 2020. Public companies or companies with state participation are excluded from these benefits.