The main goal of the Dominican Republic’s Confotur law (Tourism Incentive Law 158-01) is to promote and foster development in tourism-related sectors and promising growth regions. It aims to attract investments in the country’s tourism industry by offering substantial tax exemptions and benefits to businesses and individuals involved in projects such as hotels, resorts and other tourism developments. The law intends to boost economic growth, create jobs and cultivate the tourism sector by providing incentives to encourage investment in these specific areas. In this blog, we will delve into the details of Confotur, focusing on the tax advantages it offers to individuals.
What are the benefits of Confotur?
Title Transfer Tax Exemption:
This exemption spares you from paying 3% of the property’s assessed value when transferring the title to your name. For instance, if you buy a property with a US$ 200,000 assessed value, you’ll save US$ 6,000.
Annual Real Estate Tax Exemption (IPI) for a limited time:
Exemption from a tax equivalent to 1% of the property’s assessed value over RD$ 9,520,861 (approximately US$ 168,000) is applicable for up to 15 years.
Individuals can include their real estate investment during tax filing, potentially saving up to 20% on their taxable income.
Benefits for Foreign Investors:
Foreign investors can declare their real estate investment as an expense, leading to tax return savings. Moreover, investors acquiring a property with Confotur, regardless of its size, can apply for an Investor Visa for residency. This residency was previously available only after a minimum US$ 200,000 investment as a foreigner.
*Note: These benefits only apply to the first property owner.
In conclusion, the Confotur program in the Dominican Republic serves as a significant attraction for foreign investors seeking to capitalize on the country’s thriving tourism industry. With substantial tax exemptions, the program offers considerable savings over time. For those contemplating investment in the Dominican Republic’s tourism sector, Confotur presents a compelling case for making this Caribbean paradise their destination for growth and prosperity. However, it’s crucial to note that tax laws may change over time, so consulting legal and financial experts or government authorities is essential for the most accurate and up-to-date information regarding the Confotur program.