Law 30-26 introduces a restriction that touches the heart of the Confitur model

A two-line article prohibits the accumulation of incentive schemes. Tourism and real estate accounted for 42 cents of every dollar of foreign investment in 2025, and the sector has yet to process what that means for its tax structure

SANTO DOMINGO. – When the National Congress approved Law 30-26 and President Luis Abinader enacted it on June 18, 2026, the tourism real estate sector celebrated two widely circulated pieces of news: the reduction of the capital gains tax and the gradual elimination of the mortgage tax.

What few people read carefully was Article 1, the first of the law, the shortest and possibly the one with the greatest structural impact for a segment that has built its business model on the accumulation of tax benefits.

That article introduces numeral 2-1 to the Tax Code with a two-sentence provision: taxpayers may choose the tax regime they deem most convenient, but they cannot simultaneously benefit from more than one incentive regime with respect to the same economic activity, investment or operation.

The prohibition does not mention Confotur. It does not mention free trade zones. It does not mention any particular regime. And therein lies the problem.

Sources: BCRD, press release Feb. 2, 2026; BCRD, Preliminary Results Jan.-Dec. 2025; Situr/Mitur

Is tourism at risk?

To understand the magnitude of what that article proposes, we must start with the most recent figures from the Central Bank of the Dominican Republic. According to the press release that the BCRD published on February 2, 2026, regarding foreign direct investment at the close of 2025, FDI totaled US$5,032.3 million that year, the highest level on record, with the tourism sector accounting for 26.3% and real estate for 15.7% of the total.

Tourism and real estate, combined, contributed more than 42 cents of every dollar of FDI received by the country in 2025. The Central Bank of the Dominican Republic (BCRD) itself points out in that note that the growth of the real estate sector is closely related to the boost in tourism.

The BCRD's Preliminary Results Report for January-December 2025, published in February 2026, also records that in that year construction showed a year-on-year contraction of 1.8%, attributed by the agency to the greater gradualness and postponement in the execution of works, in an environment marked by global uncertainty and changes in fiscal and regulatory policies.

Real estate and rental activities, on the other hand, grew by 3.1% during the same period. This contrast places the new law at a time when the sector was already experiencing pressures, and any additional uncertainty regarding the incentive environment operates on more sensitive ground.

Behind these figures is Law 158-01 on the Promotion of Tourism Development, known as the Confitur Law, in force since 2001 and amended on several occasions.

In its current version, the regime offers developers: exemption from Income Tax for up to 15 years from the completion of construction; exemption from Real Estate Property Tax during that period; exemption from the 3% real estate transfer tax for the first buyer; exemption from ITBIS on goods and services related to construction; and exemption from import duties on materials and equipment.

Article 5 of Law 158-01 also establishes that the establishment of new tax burdens during the tax exemption period is prohibited.

According to data from the Tourism Information System (Situr) of the Ministry of Tourism, between 2023 and 2024, Confotur approved 117 tourism projects with a combined investment exceeding US$5.4 billion. Of that total, 76 corresponded to real estate developments, representing approximately 65% ​​of the classifications for the period.

Three crash scenarios

Article 1 of Law 30-26 does not repeal any benefit of Law 158-01 nor does it modify any of its articles. What it does is establish, at the level of the general Tax Code, a cross-cutting rule: no taxpayer may simultaneously benefit from more than one incentive regime for the same economic activity, investment, or transaction.

The potential conflict occurs in at least three scenarios that industry stakeholders identify when analyzing the text.

The first scenario involves developers operating under Confotur who have also accessed mechanisms under the general Tax Code regarding activities related to the same project, investment deductions, advance payment schemes, or other tax planning instruments. If the DGII interprets these activities as constituting a single operation, Article 2-1 could require them to choose only one tax regime.

The second involves the interaction between the ISR exemption under Confotur and the new accelerated depreciation regime for industrial machinery and equipment that Article 24 of Law 30-26 itself introduces.

Is a tourism developer who intends to take advantage of accelerated depreciation on construction equipment while already benefiting from the ISR exemption under Confotur combining two regimes on the same transaction? The legal text does not define this.

The third, with greater operational complexity, involves condohotels and mixed developments where the same legal entity operates residential units under Confotur and provides related services, vacation rental management, administration of amenities, maintenance, which could be taxed under different regimes.

The boundary between the same economic activity and different activities in that context is not defined in the legal text.

The limits of existing protection

Article 5 of Law 158-01 contains a provision that could act as a shield for already classified projects: it expressly prohibits the establishment of new tax burdens during the exemption period.

If Article 2-1 of Law 30-26 is interpreted as a new burden on those projects, that protection can be invoked. However, projects in the application phase before Confotur, or that have just received provisional classification, do not have that protection with the same clarity.

They will have to structure their tax architecture under the new rule from the outset, at a time when key definitions have not yet been established by the Executive Branch or the DGII (General Directorate of Internal Revenue). We must wait for the implementing regulations of the law.

What the law does not say

Article 2-1 does not define "same economic activity." It does not define "same operation." It does not establish a prior certification mechanism that allows the taxpayer to know, before committing capital, whether the tax combination they are considering is valid.

These definitions must come from the implementing regulations of Law 30-26, which, as of the time of this report, have not yet been issued by the Executive Branch. The DGII (General Directorate of Internal Revenue) has also not issued any general regulations.

During that period, projects undergoing financial structuring operate in an undefined landscape and in an environment of opacity and uncertainty. The same preliminary annual report from the Central Bank of the Dominican Republic (BCRD) indicates that loans from the financial system to hotels and restaurants grew by 10.2% in 2025, and housing loans increased by 13.2% during that same period.

The traction on which the sector operates rests, to a large extent, on the predictability of the fiscal environment that Confotur has offered for two decades.

For a sector that represents more than 42% of national FDI, the difference between a restrictive and a broad interpretation of article 2-1 is not just any technical detail; it is a price variable that directly affects the projected profitability of each project and that the market has already begun to process.

Sources consulted:

• Central Bank of the Dominican Republic, press release "BCRD reports that foreign direct investment reached US$5,032.3 million at the close of 2025", February 2, 2026. bancentral.gov.do/a/d/6482
• Central Bank of the Dominican Republic, Preliminary Results of the Dominican Economy January-December 2025, February 2026.
• Tourism Information System (Situr), Ministry of Tourism of the Dominican Republic, data 2023-2024.
• Law No. 30-26 on measures for economic growth, tax simplification and mitigation of the international crisis, Art. 1 (new Art. 2-1 of the Tax Code), promulgated on June 18, 2026.
• Law No. 158-01 on the Promotion of Tourism Development and its amendments (Laws Nos. 184-02, 318-04, 195-13), Arts. 4 and 5.

Recommended readings:

• Law 158-01: The guide on CONFOTUR in the Dominican Republic that investors should consult
• Tax on airfare reignites debate on tourism competitiveness
• This is the package of measures announced this Thursday by the Government to mitigate the international crisis