Dominica - Second Strengthening Fiscal and Climate Resilience Programmatic Development Policy Credit Program

Overview & Synopsis

The development objective of the Second Strengthening Fiscal and Climate Resilience Programmatic Development Policy Credit for Commonwealth of Dominica is to strengthen domestic revenue mobilization and financial sector resilience, and to promote biodiversity and disaster preparedness. The operation supports revenue reforms, including higher eco-tourism site fees, revised solid waste management tariffs on older vehicles, and the reintroduction of a highway maintenance levy, alongside the digitization of tax administration that mandates electronic filing and payment for large taxpayers to improve efficiency, compliance, and collection. It advances financial sector resilience by establishing a minimum capital requirement for the national development bank and modernizing the payments framework through a Payment System and Services Act that enables licensing of non-bank payment service providers and creates a level playing field to foster competition, innovation, and broader adoption of electronic transactions. To protect key natural assets and sustain the blue economy, the program operationalizes mandatory navigation routes and standards for vessels transiting the Sperm Whale Reserve to reduce disturbances and safeguard biodiversity. To strengthen disaster preparedness and fiscal accountability, it establishes disaster-responsive post-disaster budget execution procedures that clarify roles, streamline approvals, and improve tracking of disaster-related spending, including provisions to generate sex-disaggregated data to inform resource allocation for women’s needs in post-disaster contexts. Expected results include higher tax revenue from the supported measures, increased electronic filing among large taxpayers, improved capitalization and asset quality at the development bank, greater use of electronic fund transfers, full compliance with navigation routes in the Reserve, and enhanced readiness and gender-responsive reporting across ministries most affected by natural disasters, thereby reinforcing macro-fiscal stability, financial inclusion, sustainable tourism, and resilient service delivery.