Confotur tax exemption law
The CONFOTUR law in the Dominican Republic is designed to stimulate tourism and real estate investment by offering significant tax benefits. Here's a breakdown of the key advantages for those buying real estate. It's important to understand the CONFOTUR law's intricacies to maximize its benefits. Here's a more detailed look:
Key Aspects of the CONFOTUR Law:
Purpose:
The primary goal is to stimulate tourism development in the Dominican Republic by attracting investment in tourism-related projects.
This includes hotels, resorts, and associated infrastructure, as well as residential real estate within approved projects.
Targeted Investments:
The law encourages investment in specific types of projects, such as:
Hotel facilities and resorts.
Tourism-related real estate developments.
Infrastructure supporting tourism, like golf courses and marinas.
Tax Incentives Breakdown:
Exemption from Property Transfer Tax:
This is a significant saving, as it eliminates the 3% tax on the property's transfer value.
Exemption from Real Estate Property Tax (IPI):
This exemption, typically lasting 10 to 15 years, greatly reduces the ongoing cost of property ownership.
Import Tax Exemptions:
Developers benefit from exemptions on import duties for construction materials and equipment.
Income Tax exemptions:
In some cases, income generated from the properties can be exempt from income taxes, for a certain period of time.
CONFOTUR Zones:
The benefits apply to properties within designated tourism development zones. Therefore, it is very important to verify that the property you are interested in is within a CONFOTUR zone.
Application Process:
Developers must apply to the Tourism Promotion Council (CONFOTUR) for project approval.
The council evaluates projects based on their contribution to tourism development.
Benefits for Foreign Investors:
The law is particularly attractive to foreign investors, as it provides a stable and secure legal framework.
There are generally no restrictions on foreign ownership of CONFOTUR-approved properties.
Important Considerations:
Verification:
Always verify that a property is indeed part of a CONFOTUR-approved project.
Terms and Conditions:
Each project may have specific terms and conditions, so it's essential to review them carefully.
Long-Term Investment:
CONFOTUR benefits are designed for long-term investments.
By understanding these details, investors can make informed decisions and take full advantage of the CONFOTUR law's benefits.
Navetta Properties