Client Alerts

Sales and Use Tax on Internet Purchases and Other SUT Changes

On April 29, 2017, the Governor of Puerto Rico signed into law House Bill 849 (“Act 25-17”), which, in general, amends the Puerto Rico Internal Revenue Code of 2011, as amended (the “Code”), to impose a series of notification requirements regarding the Sales and Use Tax (“SUT”) on tangible personal property sold via Internet by .

Circular Letter of Internal Revenue No. 17-05 Taxpayer Rehabilitation Program

Puerto Rico Treasury Department implements a new Taxpayer Rehabilitation Program with the purpose of reforming and rehabilitating taxpayers through the execution of payment plans on outstanding tax debts as adopted by Circular Letter of Internal Revenue No. 17-05, issued on March 17, 2017.

GOVERNMENT ADOPTS NEW LIMITATIONS ON ISSUANCE AND USE OF TAX CREDITS

The Puerto Rico Fiscal Agency & Financial Advisory Authority (“FAFAA”) issued on March 7, 2017, Administrative Order OA-2017-01, to stay the issuance of new tax credits by the Government of Puerto Rico under a number of tax incentives laws ranging from the promotion of manufacturing and R&D activities; tourism incentive laws; investment capital fund; urban renewal; housing incentive laws; film incentives law; and certain credits included in the Puerto Rico Internal Revenue Code of 2011, among others. The consideration and issuance of new tax credits, including applications that have been submitted but are pending authorization, will now fall under the purview and evaluation of a new government committee created under the Order known as the “Committee for the Authorization of Disbursements and Tax Concessions”. The Committee is composed by the Executive Director of the FAFAA, the Secretary of the Treasury, and the Executive Director of the Office of Management and Budget, or their delegates. Close monitoring of the implementation of this Order is advisable to determine with certainty the impact this Order will have on tax credits granted and the availability of tax credits for new projects and investments.

NEW JOINT REGULATION TO ENFORCE ACT NO. 42-2015, AS AMENDED (PAYMENT ALTERNATIVES)

On November 18, 2016 the Department of Treasury (“Treasury”) and the Department of Consumer Affairs (“DACO”, for its Spanish acronym) filed with the Department of State a joint regulation to enforce the provisions of Act No. 42-2015, as amended (the “Act”), requiring (i) licensed service providers and (ii) commercial establishments to offer their clients at .

Client Alerts

Sales and Use Tax on Internet Purchases and Other SUT Changes

On April 29, 2017, the Governor of Puerto Rico signed into law House Bill 849 (“Act 25-17”), which, in general, amends the Puerto Rico Internal Revenue Code of 2011, as amended (the “Code”), to impose a series of notification requirements regarding the Sales and Use Tax (“SUT”) on tangible personal property sold via Internet by .

Circular Letter of Internal Revenue No. 17-05 Taxpayer Rehabilitation Program

Puerto Rico Treasury Department implements a new Taxpayer Rehabilitation Program with the purpose of reforming and rehabilitating taxpayers through the execution of payment plans on outstanding tax debts as adopted by Circular Letter of Internal Revenue No. 17-05, issued on March 17, 2017.

GOVERNMENT ADOPTS NEW LIMITATIONS ON ISSUANCE AND USE OF TAX CREDITS

The Puerto Rico Fiscal Agency & Financial Advisory Authority (“FAFAA”) issued on March 7, 2017, Administrative Order OA-2017-01, to stay the issuance of new tax credits by the Government of Puerto Rico under a number of tax incentives laws ranging from the promotion of manufacturing and R&D activities; tourism incentive laws; investment capital fund; urban renewal; housing incentive laws; film incentives law; and certain credits included in the Puerto Rico Internal Revenue Code of 2011, among others. The consideration and issuance of new tax credits, including applications that have been submitted but are pending authorization, will now fall under the purview and evaluation of a new government committee created under the Order known as the “Committee for the Authorization of Disbursements and Tax Concessions”. The Committee is composed by the Executive Director of the FAFAA, the Secretary of the Treasury, and the Executive Director of the Office of Management and Budget, or their delegates. Close monitoring of the implementation of this Order is advisable to determine with certainty the impact this Order will have on tax credits granted and the availability of tax credits for new projects and investments.

NEW JOINT REGULATION TO ENFORCE ACT NO. 42-2015, AS AMENDED (PAYMENT ALTERNATIVES)

On November 18, 2016 the Department of Treasury (“Treasury”) and the Department of Consumer Affairs (“DACO”, for its Spanish acronym) filed with the Department of State a joint regulation to enforce the provisions of Act No. 42-2015, as amended (the “Act”), requiring (i) licensed service providers and (ii) commercial establishments to offer their clients at .