Dominican tax expenditures estimated at RD$458,629.93 million for 2027, 4.78 % of GDP

The Ministry of Finance and Economy of the Dominican Republic published on October 26, 2026 its Tax Expenditure Estimate for fiscal year 2027, prepared for the budget bill. Tax expenditures, the revenue the state forgoes through exemptions, deductions, credits, reduced rates and other preferential treatments, are estimated at RD$458,629.93 million, equal to 4.78 % of projected GDP.

Compared with 2026

The 2027 amount is RD$17,184.70 million (3.89 %) higher than the revised 2026 estimate in nominal terms, but falls 0.28 percentage points as a share of GDP, from 5.06 % to 4.78 %. The 2026 revision (RD$441,445.23 million) is 12.17 % above the initial estimate of RD$393,541.54 million, mainly because of updates to the VAT (ITBIS), the excise tax on fuels and import duties.

By tax

Indirect taxes account for RD$316,391.12 million (68.99 %) and direct taxes RD$142,238.81 million (31.01 %). The VAT (ITBIS) is the main component, with RD$249,805.88 million (54.47 % of the total and 2.60 % of GDP), followed by property taxes (RD$80,868.57 million, 17.63 %) and income tax (RD$61,370.23 million, 13.38 %). By sector, 65.84 % is concentrated in general exemptions for individuals, industrial free zones, health, education and tourism.

The Ministry notes that these figures approximate the fiscal cost of current treatments and are not equivalent to what would be collected if they were eliminated.

Source: Ministerio de Hacienda y Economía (document in Spanish).

This is an English summary by Economía con Datos. Read the full article in Spanish.

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