Dominican Republic Tax Rates
The Dominican Republic operates a progressive tax system administered by the Dirección General de Impuestos Internos (DGII). Personal income tax has three brackets with a top rate of 25%, the corporate tax rate is 27%, and the ITBIS (VAT equivalent) rate is 18%. The country taxes residents on worldwide income and non-residents on Dominican-source income. The Dominican Republic is the largest economy in the Caribbean and Central American region.
Top Income Tax Rate
25%
Corporate Tax Rate
27%
VAT / Sales Tax
18%
Capital Gains Tax
27%
Detailed Tax Information
Income Tax Brackets
The Dominican Republic imposes a progressive personal income tax with four brackets ranging from 0% to 25%. The exempt threshold and brackets are adjusted annually for inflation. Residents are taxed on worldwide income with foreign tax credits available. Non-residents are taxed at 25% on Dominican-source income. Employment income is subject to monthly withholding. Deductions include education expenses (for the taxpayer and dependents) and a non-taxable allowance. The Dominican Republic does not allow deductions for mortgage interest or medical expenses at the personal level.
| Income Range | Tax Rate |
|---|---|
| RD$0 – RD$416K | 0% |
| RD$416K – RD$624K | 15% |
| RD$624K – RD$867K | 20% |
| RD$867K+ | 25% |
Corporate Tax
The Dominican Republic imposes a 27% corporate income tax on resident companies. Non-resident companies are taxed at 27% on Dominican-source income. Companies in free trade zones (zonas francas) are exempt from income tax. An alternative minimum tax of 1% of taxable assets applies when the regular income tax is lower. Companies must make monthly advance tax payments. Transfer pricing rules have been strengthened in recent years.
Standard Rate
27%
Capital Gains Tax
Capital gains in the Dominican Republic are generally treated as ordinary income and taxed at the individual's marginal rate (up to 25%) or the corporate rate (27%). Real estate capital gains are calculated based on the difference between sale price and the inflation-adjusted cost. A 1% tax is withheld on real estate transactions as an advance payment.
Short-Term Rate
27%
Long-Term Rate
27%
Rate
27%
VAT / Sales Tax
The Dominican Republic levies an 18% ITBIS (Impuesto a las Transferencias de Bienes Industrializados y Servicios) on most goods and services. Basic food items, medicines, fuel, educational services, and health services are exempt or zero-rated. The ITBIS has been gradually expanded to include services that were previously exempt. Exports are zero-rated. Monthly ITBIS returns are required for registered businesses.
Standard Rate
18%
Cryptocurrency Tax
The Dominican Republic does not have specific cryptocurrency tax legislation. The Central Bank has stated that cryptocurrencies are not legal tender. Crypto gains would likely be subject to income tax under general principles, but specific guidance from the DGII is lacking. The regulatory framework for digital assets remains undeveloped.
Tax Treaties
The Dominican Republic has a very limited tax treaty network with approximately 3 double taxation agreements. The country has treaties with Spain and Canada, and a Tax Information Exchange Agreement with the United States. The Dominican Republic participates in the Global Forum on Transparency and Exchange of Information for Tax Purposes and has been expanding its international tax cooperation framework.
Treaty Network
3
Double taxation agreements
Major treaty partners:
Key Details
Relocate to Dominican Republic
See how much you could save by moving here from your current country.
+$18K
Tax in United States
$24K
24.4% effective
Tax in Dominican Republic
$6K
5.9% effective
You Save
75.7%
less tax annually
US Citizens: Important Note
US citizens are taxed on worldwide income regardless of residence. You'll still need to file US taxes, though the Foreign Earned Income Exclusion and Foreign Tax Credit may reduce your liability.
