SANTO DOMINGO. - Although he previously stated that he would await the Government's proposal on the much-discussed tax reform before commenting on the matter, yesterday the president of the Dominican Republic's Hotel and Tourism Association, David Llibre, offered his perspective on the approach that should prevail in the sector he represents regarding the project being prepared by the Government: Avoid introducing changes that would dim the sector's potential and maintain tourism as an engine of the Dominican economy.
The businessman outlined that in the case of the tourism sector, rather than talking about a reform, it is necessary to review which elements are already contemplated in Law 158-01 for the Promotion of Tourism Development that should be maintained.
Speaking at the meeting held by the Ministry of Tourism to present the monthly report on the evolution of visitor arrivals to the country last May, Llibre opined that the hotel sector expects the current tax conditions that incentivize private hotel investment to be maintained.
He considered that the current incentive scheme has been part of the "formula" that has stimulated the arrival of visitors and has allowed the country to project more than 11 million visitors by the end of 2024.
"Now, at a general level, the sector needs that structure that has allowed for growth today," he emphasized.
The hoteliers' representative indicated that the country must continue developing new hotel rooms, updating existing facilities, and strengthening complementary policies.
"This is the main reason, though not the only one, for not giving up on the conditions that have brought us to where we are, and for understanding the need to maintain the current tax structure, and not to introduce changes that would dim the light that our sector projects, and to keep tourism as an engine of the Dominican economy," he noted.
He argued that when indirect and induced impacts are added together, Dominican tourism contributes up to 19% of the gross domestic product (GDP).
He asserted that the industry also contributed more than $5.9 billion to the Dominican economy just in purchases from other sectors (4.95% of GDP) such as electricity, manufacturing and construction.
"Every 100 pesos generated in added value directly for the sector produced an additional 188 pesos directly and indirectly," he highlighted.
He explained that "these tax incentives contribute to maintaining competitiveness, especially because the Dominican tourism product 'is not alone in the world'.".
He explained that this business sector invests in new rooms and in renovating existing ones to remain attractive. "There is very high competition. We must maintain an up-to-date tourism infrastructure. It is necessary to have the laws that have allowed this growth to date," he emphasized.
"Energy expenditure, infrastructure issues, and the fact that many hotels in different tourist areas still need to make investments, these are some of the issues that need to be addressed when we talk about tax reform," Llibre pointed out.
