Tuesday, January 31, 2023

Elixir for a Tax Base

By on March 26, 2022

If there were any truth to the English language, the word “tax” would be a four-letter word. That is particularly true in Puerto Rico, where paying taxes—impuestos—is often seen as an undeserved imposition because government administrations have failed to deliver essential services with the efficiency expected by “we, the people.” The culture of evasion underpins an estimated $2.8 billion in uncollected taxes over nearly three decades. That failed haul suggests el pueblo has inverted the lyrics to the Beatles’ song “Taxman” from “It’s one for you, 19 for me,” in its favor in applying a mantra of shared pain. In fact, our overnment has given and given with little in return as it offers decrees to millionaires while the taxpaying middle class shoulders the load.

Few people know this better than Puerto Rico’s taxman, Francisco Parés, who is resorting to sugar and spice and everything nice in bringing taxpayers back into the fold—he likens it to using jarabe instead of chemo to cure the evasion malady. Although Parés has only been at the helm of Hacienda since 2019, el nuevo secretario has taken enormous challenges in stride. His was a scalding baptism as he went from the frying pan into the fire amid scandal after his boss, then-Treasury Secretary Raúl Maldondo was forced to resign after he made assertions that there was an “institutional mafia” at the agency.

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