CONFOTUR Explained: How the Tax Exemption Really Works

CONFOTUR is probably the word you'll hear most while shopping for property in Punta Cana — and also one of the worst explained. Let's set it straight. Law 158-01 on Tourism Development created the Consejo de Fomento Turístico (CONFOTUR), the council that approves real estate projects in tourism zones and grants them tax incentives to attract investment. The incentive belongs to the project — and you, as a buyer, inherit the benefits when you purchase in an approved one.

The two benefits that actually matter to you: first, exemption from the property transfer tax (3% of value), a one-time payment that stings — on a US$180,000 unit that's US$5,400 staying in your pocket. Second, exemption from the IPI (the annual 1% property wealth tax on the value above the exempt threshold) for up to 15 years from the project's approval date. On that same example, that's thousands of dollars a year staying in your return.

The fine print to watch: verify that the project's CONFOTUR resolution exists and is still valid — ask for the resolution number and check it, don't settle for a logo on the brochure. Also watch the clock: the 15 years run from the project's approval date, not from your purchase date; in a project approved six years ago, you have 9 years of exemption left. All of this gets checked during due diligence, and it's part of what I do for every client.

Bottom line: CONFOTUR is real, it's valuable, and it can mean over US$25,000 in savings on a typical purchase. Just make sure it holds true for the specific project — and that the project is worth buying on its own merits, with or without the exemption. The incentive makes a good purchase better; it doesn't fix a bad one.