Thursday, August 8, 2019
Dominica's Budget, released on July 30, 2019, included value-added tax changes and tax relief for home owners.
Presently, a resident taxpayer may deduct from their taxable income up to DOP25,000 (USD490) in interest paid on a mortgage for an owner-occupied home. This will be increased to DOP30,000, and a deduction for a second property of DOP15,000 will be allowed for tax years beginning January 2020. Taxpayers will be allowed to alternatively deduct the cost of improving either home, subject to the aforementioned caps.
The tax on residential rental income will be set at a flat rate of 20 percent, after allowing for the deduction of interest expenses related to the property and property insurance.
Effective October 1, 2019, a zero rate of VAT and an exemption from import duty will be introduced for electric buses, electric cars, and electric motorcycles. Import duty and excise tax will be waived on all buses which have between 21 and 29 seats that are no older than five years and are used for island tours by the cruise sector.
Further, from September 1, 2019, VAT will be waived on bathroom aides, reclining beds, and lifting chairs for the infirm; baby wipes; and diapers.