Friday, August 12, 2022

Act 154 Tax Substitute Bill on Way to Approval

By on June 30, 2022

Lawmaker Assures Measure Will Pass Despite Senate, House Spat

The Puerto Rico Legislative Assembly was in the process this week of passing legislation that would replace the Act 154 of 2010 excise tax of 4 percent on controlled foreign corporations (CFCs) with income and royalty taxes against which a federal tax credit could.

Both the House of Representatives and the Senate had passed last week amended versions of House Bill 1367, titled the Puerto Rico Public Finances Stabilization Act, which, among other revenue collection measures, includes a 10.5 percent tax on income and royalties generated by CFCs, mostly U.S.- based pharmaceutical and medical device corporations that have tax decrees and currently pay the 4 percent excise tax on sales of manufactured products.

As of press time Wednesday, the amendments by both chambers were still being reconciled in a conference committee, which includes Senate and House representation, House Budget and Treasury Chair Jesús Santa Rodríguez told Caribbean Business.

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