The Dominican Republic published Presidential Decree No. 265-19 of 1 August 2019, which introduces a new simplified tax regime (RST) for small entities. This previous simplified tax regime is canceled and RST is applicable for both legal and natural taxpayers as of 2019 fiscal year.
Taxpayers whose annual gross income below DOP 8.7 million or the amount of purchases and imports less than DOP 40 million over the course of a year, can qualify for the new tax regime. Note that, qualifying legal persons have to pay an effective tax rate of 7 percent on the annual gross income declared, which covers both income tax (ISR) and the tax on the transfer of industrialized goods and services (ITBIS).
Under this new tax regime, eligible taxpayers need not to make certain declarations to the tax authority, advanced income tax payments, and they will be exempted from asset tax payments if related to economic activity. Also, for taxpayers who qualify under these requirements, annual returns are due no later than end day of February the following year.
