Dominican Republic Hit With 10% Tariff Today By US

[SKY]

Dominican Republic

10%

10%

Trump tariff chart: Full list of countries hit with 'reciprocal' tariffs

President Donald Trump, speaking at the White House, held up a chart showing proposed import taxes: 34 percent on China, 20 percent on the EU, among others.

www.newsweek.com

 

[Tom F.]

The chart states the DR charges 10% on US imports and will have a 10% reciprocal tariff. I thought the VAT is 18% currently. Please correct me.

 

[SKY]

The chart states the DR charges 10% on US imports and will have a 10% reciprocal tariff. I thought the VAT is 18% currently. Please correct me.

The Vat and Tariffs are two different things............

 

[aarhus]

The Vat and Tariffs are two different things............

At one point he said that he considered Vat a tariff.

 

[Glenn Burke]

Since the beginning of his term, Trump acts like a person with bipolar disorder in a manic phase.

For those who doesn't know what's that: During a manic phase of bipolar disorder, individuals experience a period of abnormally elevated, expansive, or irritable mood, often accompanied by increased energy, activity, and impulsivity, which can lead to poor judgment and risky behaviors.

I hope his trade wars won't affect prices in DR, because everything here is already too expensive for a third world country.

 

[NALs]

It depends how that tariff is applied.

Most of what the DR exports to the USA are from the free trade zones. Very few things ensembled in the free trade zones don’t have US made components. In fact, in many cases the components are imported from the USA, ensambled in the free trade zones and essentially re-exported to the USA. That’s why they are largely exempt from most or all Dominican taxes during import and the ensemble product during export. Those that are “exported” from the free trade zones to the Dominican market -to be sold to Dominicans whether individuals or companies- are subject to Dominican taxes, otherwise no.

If the tariffs are reciprocal as that article states and reciprocal means what everybody knows and not some special meaning they made up for this legislation, then I think Dominican exports to the USA for the most part would be exempt from the reciprocal tariffs since they don’t pay taxes, import duties or export tariffs.

Under that assumption, the only Dominican products that may be applied the reciprocal tariffs are those export ed to the USA from non-free trade zones factories which is most of the Dominican manufacture. Dominican exports from those factories actually are relatively few since much of what they make is actually consumed in the DR, it never leaves the country. Much of the Dominican products exported by those factories are mostly consumed by Dominicans in the USA. A good chunk of products with Dominican brands in the USA aren’t even exported from the DR. Take Presidente as an example. Every Presidente beer bottle or can sold in the USA is actually made in the USA.

 

[keepcoming]

Need to keep the posts related to how the tariffs may or may not affect the DR.

 

[Glenn Burke]

Need to keep the posts related to how the tariffs may or may not affect the DR.

If Trump's trade wars will affect prices in US, prices will go up, so everything imported from US will be even more expensive in DR. That's how. Of course I hope it won't happen, because most of the tariffs announced today will be postponed, delayed or reversed.

 

[playacaribe2]

The 10% tariff on the DR will begin at 12:01 AM April 5th.

With few exceptions the DR will be affected. The biggest exception for the DR is gold.

Products manufactured in the free trade zones and exported to the US will be tariffed 10%.

The issues with the DR and they are small compared to the the other larger trading partners of the US, are rice and autos. The DR imposes heavy quotas/tariffs on US rice imports, despite DR/CAFTA having sunset them. Additionally, and from personal experience, the DR has not abided by DR/CAFTA in that US made vehicles would enter the DR essentially under a reduced tax regimen compared to vehicles manufactured in other countries.

Finally, unless something changes, on May 5th, 2025 small value goods from China will also be taxed. Think of the small items people purchase and send to a P.O. Box in the US and then send via courier to the DR.

The worldwide implications on people and goods are huge and I suspect the phone lines at the WH are lighting up from countries looking for exemptions or as is the case of Vietnam looking to rethink their tax/tariff regimen.

Agree or disagree, the fact is the US is merely asking for fair trade and an even tax/tariff playing field, something that has been missing for decades.

Respectfully,
Playacaribe2

 

[SKY]

The only thing this Tariff war will accomplish is to raise prices not only in the Dominican Republic but the rest of the World...............And the US will be the worst hit..........

 

[JLSawmam]

At one point he said that he considered Vat a tariff.

"He" as in Trump? He also has said many times it's those who export to the US who pay the tariffs, so he's not exactly the economic expert he tries to portray. In time we'll know the effects here in the DR...and if @playacaribe2 is correct about the small packages, I think more of us will explore other ways to purcahse online, such as the free shipping to the DR by Amazon,

 

[playacaribe2]

"He" as in Trump? He also has said many times it's those who export to the US who pay the tariffs, so he's not exactly the economic expert he tries to portray. In time we'll know the effects here in the DR...and if @playacaribe2 is correct about the small packages, I think more of us will explore other ways to purcahse online, such as the free shipping to the DR by Amazon,

De minimus goods ($800 usd or less) will be taxed beginning May 5, 2025. This will hit Chinese companies like Temu and Shein the hardest as they are the major companies involved in these types of low end goods.

The silver lining, if there is one, may be the DR postal system will get better.

Respectfully,
Playacaribe2

 

[windeguy]

Need to keep the posts related to how the tariffs may or may not affect the DR.

People in the USA will likely pay more for goods from the DR. That is what a 10% tariff on DR goods coming into the USA does.

So the DR might sell fewer goods to the USA. Not an ecomic expert, so I am not sure why any USA goods coming into the DR should have
a 10% tariff coming for which Trump is now reciprocating.

My point is that If the DR had no tariff on US goods from DR-CAFTA, then there should be no 10% tariff on DR goods. Some goods must be exempt from DR-CAFTA and the DR is charing a tariff on them?

Someone expert in this can elaborate.

 

[NALs]

The only thing this Tariff war will accomplish is to raise prices not only in the Dominican Republic but the rest of the World...............And the US will be the worst hit..........

Before the US created income taxes supposedly to pay for a war that by now has been paid for many times over (somehow the US government had a change of mind since technically income taxes were suppose to go away once the war was paid, ahem), most of the revenue of the US government came from tariff. Trump isn’t a particular young you. Could it be that he know that?

One of the things Trump said in the campaign was to get rid of income taxes.

 

[playacaribe2]

People in the USA will likely pay more for goods from the DR. That is what a 10% tariff on DR goods coming into the USA does.

Perhaps. Or, you could also have exporters to the US absorb the increase and decrease their profit margins to retain market share.

So the DR might sell fewer goods to the USA. Not an ecomic expert, so I am not sure why any USA goods coming into the DR should have
a 10% tariff coming for which Trump is now reciprocating.

My point is that If the DR had no tariff on US goods from DR-CAFTA, then there should be no 10% tariff on DR goods. Some goods must be exempt from DR-CAFTA and the DR is charing a tariff on them?

Goods coming from the US will not have any additional tariffs unless the DR retaliates.
If you read the Trade report, it indicates the DR is/was lax in 2 major areas, autos and rice imports. Both of those items were in DR/CAFTA whereby taxes/tariffs/duty/quotas would be reduced or eliminated. That has not happened. And so you have the new 10% tariff on DR goods entering the US.

Someone expert in this can elaborate.

I am not an expert, but have done enough trade in autos to the DR to know how they have circumvented the spirit and intent of the DR/CAFTA trade agreement. So now they are being called out on it, something the auto importers have been asking about for years.

Respectfully,
Playacaribe2

 

[windeguy]

playacribe2, When I saw what the DR did to circumvent DR/CAFTA with its new first license tax on autos from the USA, I called the US department in charge of DR/CAFTA and explained how the DR violated the spirit of DR/CAFTA.

I told them how the DR just changed the tariff for a new tax on cars. Some nonsense tax called a first license fee if I recall the name properly. I am sure they just said , oh well, we don't really care.

That was then and this is Trump. I personally don't like this type of trade war, but now we have it.

 

[playacaribe2]

playacribe2, When I saw what the DR did to circumvent DR/CAFTA with its new first license tax on autos from the USA, I called the US department in charge of DR/CAFTA and explained how the DR violated the spirit of DR/CAFTA.

I told them how the DR just changed the tariff for a new tax on cars. Some nonsense tax called a first license fee if I recall the name properly. I am sure they just said , oh well, we don't really care.

That was then and this is Trump. I personally don't like this type of trade war, but now we have it.

Yes, the 17% first placa circumvented the spirit of the agreement as it related to autos. And then they further refused to reduce tariffs on qualifying US made vehicles. Because the DR is not a major trading partner, there was a sort of benign neglect by US trade officials regarding enforcement. That was then and this is now. How hard they pursue it against the DR is anybody's guess, but for sure President Trump has gotten lots of governments' attentions regarding fair trade.

Respectfully,
Playacaribe2

 

[cavok]

If Trump's trade wars will affect prices in US, prices will go up, so everything imported from US will be even more expensive in DR. That's how. Of course I hope it won't happen, because most of the tariffs announced today will be postponed, delayed or reversed.

More expensive than they already are because of the high tariffs the DR places on many American goods.

 

[windeguy]

And if you order made in China (or other countries) stuff from the USA to be shipped to the DR by a freight forwarder, you will be paying the additional price for US tariffs on Chinese , or other countries, stuff. Too bad the mail system does not work in the DR to order direct from various countries. And so it goes.

 

[Meemselle]

De minimus goods ($800 usd or less) will be taxed beginning May 5, 2025. This will hit Chinese companies like Temu and Shein the hardest as they are the major companies involved in these types of low end goods.

The silver lining, if there is one, may be the DR postal system will get better.

Respectfully,
Playacaribe2

Wait. There's a Dominican Postal System?