Santo Domingo. - The Free Trade Agreement with the United States and Central America (Dr-Cafta) will allow Dominicans to bring vehicles made in the U.S., or those whose parts are at least 35% original from that market, free of Customs duties starting January 1.

Preferred vehicles such as Toyota, made anywhere in the world, though with 35% of their original components from the U.S., also qualify for the Dr-Cafta’s preference.

The measure also applies for auto parts, batteries and tires, as long as they are originally from the U.S.  A product is considered a country original when its components or raw materials are from that territory.

American made vehicles now pay a 5% Customs duty as the DR-Cafta stipulates, as the gradual clearing begun in 2005.

Other levies

The reduction of the 5% Customs tax doesn’t exempt occasional importers from paying a 17%  tax for the first license plate, which led many analysts to affirm that the 2005 tax reform and later fiscal rectification have swallowed the Dr-Cafta’s advantages for consumers.

The disposition also applies to less than five year old used vehicles, although in that case occasional importers of used vehicles have faced problems because they must first obtain the certificate of origin  prior to importing it, to secure the exemption.

This occurs because in many cases a two or four year old vehicle could’ve been in a collision or have undergone a failure and the new parts aren’t American.

Another case which occurs in Customs and is that the U.S., as part of the Nafta (free trade pact  with Mexico and Canada) places seals which don’t establish in a segmented manner which are the components from each of those markets, and creates problems to the importer.