This is the first time a Dominican fiscal package has intervened in a coordinated way in the entire cycle of financed housing: the seller's offer, the financing, the cost of credit, the legal formalization of the project, and the transfer of assets
SANTO DOMINGO. – The process of acquiring a home through bank financing in the Dominican Republic involves, at different times, at least five tax burdens, which the government proposes to modify simultaneously in the anti-crisis plan that it sent to the National Congress on June 11, 2026.
The context in which these measures are being implemented is not one of contraction, but rather the market is in a moment of expansion, with access costs that the Government calls anachronistic.
In slide 24 of the official presentation, "Measures to promote economic growth and mitigate the international crisis," from the Ministry of Finance and Economy, dated June 11, 2026, the Government states that "these are taxes that make no sense and affect competitiveness, unnecessarily increasing the cost of formalization," and adds, regarding the specific case of mortgages: "the law that taxes them dates back to 1890."
Current situation
According to the Report on Credit in the Financial System published by the Superintendency of Banks, the mortgage loan portfolio registered the highest growth rate among all types of bank financing in 2025, with an annual increase of 13.2%, which placed that portfolio at RD$443,170 million.
Within the total portfolio of the banking system, which closed the year at RD$2.39 trillion, mortgage loans represented 18.5%, consolidating themselves as the third most important component of bank financing in the country.
The dynamism was maintained in the first quarter of 2026, according to the quarterly performance report of the financial system of the Superintendency of Banks corresponding to March 2026, with a mortgage portfolio that registered a year-on-year growth of 11.4%.
In that context, the total assets of the financial system reached RD$4.28 trillion and the weighted average active interest rate of multiple banks stood at 13.28% at the close of the first quarter of 2026.
This credit dynamism coexists with a housing deficit that the Ministry of Housing and Buildings, in the Ten-Year Housing Plan 2022-2032, quantified at more than 1.4 million units, according to data from the ENHOGAR Survey, of which 73% is of a qualitative nature, that is, homes built with deficient materials, without access to basic services or in overcrowded conditions.
It is against this backdrop that the Ministry of Finance and Economy presented a package that, according to the official presentation by Minister Magín J. Díaz, groups taxes related to mortgages, company formation, and life insurance under the same category: they are "taxes that make no sense and affect competitiveness, unnecessarily increasing the cost of formalization."
The first point in the chain: the offer
Before a buyer signs a loan agreement, someone must offer a property on the market, and the tax burden on the seller influences that decision. The plan proposes reducing the Capital Gains Tax applicable to the sale of real estate from 25% to 10% when the transaction is carried out by individuals. The measure is classified in the Treasury document under the heading of tax simplification.
According to the General Directorate of Internal Taxes, the capital gains tax is levied on the difference between the sale price and the tax basis of the asset, and must be reported on the annual income tax return. The proposed reduction applies exclusively to individuals, not to legal entities.
The second point: the cost of financing
Once a buyer obtains a mortgage loan, they face a mortgage registration tax. According to the DGII Help Community, the current rate is 2% of the mortgage value, based on Article 8 of Law 173-07 on Tax Collection Efficiency.
Registrations are exempt when made through financial intermediaries and the mortgage value is less than RD$2,197,446, an amount that is adjusted annually. The DGII has also clarified that this 2% is not deductible from Income Tax.
The plan proposes the gradual repeal of this tax. The official presentation from the Treasury indicates that the law taxing mortgages dates back to 1890 and classifies it as a pro-economic growth measure, not a fiscal consolidation measure. The document does not specify the timeline or the stages of the gradual elimination; this information will be defined in the text of the bill and during its parliamentary debate.
The third point: life insurance
In the mortgage financing process, banking entities usually require life insurance linked to the loan, which is currently subject to the Selective Consumption Tax.
The plan proposes its gradual repeal, a measure that the Treasury document groups together with mortgages and company formation under the same justification: they are charges that unnecessarily increase the cost of formalization.
The fourth point: legal formalization
Real estate development projects in the Dominican Republic are frequently structured through trusts or special purpose entities, legal instruments that require the incorporation of a company and the payment of the corresponding tax, set at 1%.
The plan proposes the elimination of that tax with immediate effect, unlike the other measures in this group, which are gradual.
The fifth point: the transfer of real estate assets
For owners who wish to transfer real estate to their children during their lifetime, the current inheritance tax, whose law, the Treasury document indicates, dates from 1950, establishes a rate of 25%.
The plan proposes reducing it to 3% for transfers between parents and children made during their lifetime, and the Treasury classifies this measure within the tax simplification block.
What the plan does not change
The Treasury document is explicit about the limits of the package: the Tax on the Transfer of Industrialized Goods and Services is not modified, the rates of the Real Estate Property Tax and its minimum exemption are not altered, and the three percentage point increase to the corporate income tax applies exclusively to companies with incomes exceeding RD$1 billion annually.
All the proposed measures require approval from the National Congress; none are of immediate administrative application, with the exception of the elimination of the 1% fee for the incorporation of companies, which the document indicates will have immediate effect once the law is approved.
The timetables for phasing out the mortgage tax and the excise tax on life insurance are not detailed in the official presentation and will be defined in the legislative process.
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