The advantages of the CONFOTUR law for tourism investments

The CONFOTUR law (Law 158-01) offers significant tax advantages to investors in the Dominican Republic’s tourism sector. The scheme is overseen by the Tourism Incentives Center (CONFOTUR), which examines and approves eligible projects. Once a project has been approved, the investor must start work within three years in order to benefit from tax exemptions. If this deadline is not met, all benefits are lost.
However, due to the Covid-19 pandemic, CONFOTUR has granted a two-year extension to projects classified in 2020 or still within the initial three-year deadline. This measure enables developers to launch their projects despite the delays caused by the health crisis.

Tax exemptions under the CONFOTUR Law

Properties covered by the CONFOTUR law benefit from full tax exemption on several important taxes:

– Transfer tax on real estate rights: 3% of the value of the property.
– Property tax (IPI): 1% of the annual value of properties exceeding RD$7,140,000. If you own several properties, their values are added together, and only the amount exceeding this threshold is taxable.

As an investor, you are exempt from paying these taxes for a period of 10 to 15 years, depending on project approval. This exemption encourages the acquisition of real estate and facilitates the profitability of investments in the tourism sector.

Impact of the CONFOTUR law on tourism

Since its adoption, the CONFOTUR law has stimulated growth in the Dominican Republic’s tourism sector. It has encouraged national and foreign investment, thereby strengthening the local economy. Thanks to these tax advantages, the country continues to attract numerous promoters keen to develop sustainable and innovative tourism projects.