Dominican Republic

Law 30-26 enacted on June 2026 introduced several changes that affect corporate income tax in the Dominican Republic, such asthe increase of the corporate income tax rate from 27% to 30% for taxpayers that have income of at least RD$1 billion. This rate is temporary for fiscal years 2026, 2027, and 2028, and then returns to 27% in 2029.

The law broadens the taxable base for Dominican resident taxpayers by confirming that resident individuals and entities are taxed not only on Dominican-source income, but also on certain foreign-source income from investments, financial gains, and technical assistance services. It also defines technical assistance very broadly, including legal, financial, accounting, tax, administrative, IT, software, cloud, cybersecurity, AI, and data-related services.

The law also strengthens the source rule for technical assistance, stating that technical assistance used in the Dominican Republic is treated as Dominican-source income for the service provider even if the work is performed abroad.

For cross-border payments, the law provides that payments of Dominican-source income to non-residents are generally subject to withholding at the rate 27%, unless a special rule applies. It separately imposes a 15% withholding tax on outbound payments for royalties and rights, and also on payments for software licenses, online advertising, and data storage/use, unless the software transaction is a true transfer of ownership.