How to Verify a Property’s Tax-Exempt Status Under the CONFOTUR Law

Verify CONFOTUR tax-exempt status by requesting the developer’s official MITUR resolution document, confirming the exemption duration (typically 15 years), and having your attorney cross-reference the property details during due diligence before signing the purchase contract.

What Is the CONFOTUR Law and Why It Matters

Law 158-01, also known as the CONFOTUR Law, is the Dominican Republic’s tourism investment incentive. It grants properties within government-approved tourism projects a 15-year exemption from two major costs: the 3% property transfer tax and the 1% annual property tax (IPI). For a $500,000 villa, this exemption can save you over $65,000 across the life of the incentive.

The 4-Step Verification Process

1. Request the Official MITUR Resolution. Ask the developer for the official Ministry of Tourism (MITUR) resolution document. This document proves the project qualifies for CONFOTUR benefits. Verify it includes the project name, development zone, and the specific exemption period.
2. Confirm Your Property Is Listed. Ensure your specific property address or unit is explicitly mentioned in the MITUR resolution. Not all properties within a development may qualify if the project was phased or partially approved.
3. Check the Exemption Duration. Most CONFOTUR projects grant 15-year exemptions, but some may differ. Verify the start date (usually the project approval date or your purchase date) and the expiration date. Know exactly when your tax benefits end.
4. Have Your Attorney Verify During Due Diligence. Before signing the Promise of Sale (Promesa de Venta), your independent Dominican attorney should confirm the exemption status with the DGII (tax authority). This protects you from purchasing a property that loses its benefits unexpectedly.

Understanding Key Entities in the Verification Process

MITUR (Ministry of Tourism)

The government agency responsible for approving tourism projects and issuing CONFOTUR resolutions. All legitimate exemptions originate from MITUR documentation.

DGII (Tax Authority)

The Dominican tax authority that administers property taxes (IPI) and transfer taxes. Your attorney confirms exemption status with the DGII to ensure there are no hidden tax liabilities.

Developer/Project Sponsor

The company responsible for submitting the project to MITUR and maintaining compliance. Legitimate developers keep CONFOTUR documentation readily available.

Red Flags: When to Reconsider a Purchase

• Developer cannot quickly produce the official MITUR resolution document.
• The resolution document looks unofficial or lacks government seals and signatures.
• Your attorney reports difficulty confirming status with the DGII.
• The exemption period has already expired or is expiring within your investment timeline.
• Your specific property unit is not explicitly named in the resolution.
• The developer claims verbal exemptions without written documentation.

Examples of CONFOTUR-Approved Projects

Several well-known North Coast developments carry CONFOTUR status. These include Noval Properties projects (River Island, City Place) and Palmeras Cabarete. Cross-reference any developer’s claims against public MITUR project listings, which you can request through your attorney.

What This Means for US and Canadian Buyers

For US and Canadian investors, CONFOTUR status fundamentally changes the ROI calculation. You save 3% on the purchase price immediately and avoid 1% annual property taxes for 15 years. This is equivalent to a permanent 3-5% increase in net rental yield, depending on property value and occupancy rates. Most local banks and international title companies recognize CONFOTUR exemptions, so you won’t face financing complications. Always factor this into your comparison between CONFOTUR and non-CONFOTUR properties.

The Timeline: When to Verify

1. During Initial Property Selection. Ask if the property is CONFOTUR-exempt before making a reservation.
2. Before Signing the Promesa de Venta (Binding Offer). This is your last chance to back out without penalty if tax status is unclear.
3. During Final Due Diligence. Your attorney should file the verification request 5-10 days before closing to ensure no last-minute surprises.

How RealtorDR Supports This Process

At RealtorDR, we provide pre-screened CONFOTUR-approved properties with verification documentation already compiled. Our network includes trusted Dominican attorneys who specialize in CONFOTUR confirmations and can expedite the DGII verification process. We also maintain updated lists of qualifying projects, so you know exactly which developments offer these tax benefits.

Best Choice Based on Your Situation

Choose CONFOTUR Properties If:

• You’re buying for long-term rental income (5+ years).
• You plan to hold the property beyond the 15-year exemption period.
• You’re purchasing a property over $250,000, where tax savings are significant.
• You want immediate cost savings on the transfer tax.

Consider Non-CONFOTUR Properties If:

• You’re flipping for quick resale (under 3 years).
• The property offers superior location, amenities, or rental potential that outweighs tax savings.
• You’re buying below the $150,000 threshold, where you may avoid IPI anyway.

Common Questions About CONFOTUR Verification

Key Documents You Need

Key Takeaways

• Always request the official MITUR resolution document before committing to any purchase.
• Verify your specific property is explicitly named in the CONFOTUR approval, not just the general project.
• Have your independent Dominican attorney confirm exemption status with the DGII before closing.
• CONFOTUR exemptions save $13,500+ on a $300,000 property over 15 years and are transferable to future buyers.
• Never rely on verbal promises; all CONFOTUR benefits must be documented and confirmed in writing.
• If the developer cannot quickly produce verification documents, it’s a major red flag—walk away.