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House Approves Tax Reimbursement Credit Bill

By on January 11, 2016

SAN JUAN – The Puerto Rico House of Representatives approved a bill Monday afternoon that would give taxpayers the choice of keeping any tax reimbursements as credit toward the payment of government services, fines or penalties.  

House Bill 2752—co-authored by Carlos “Charlie” Hernández López, Popular Democratic Party (PDP) majority leader; and Rafael “Tatito” Hernández Montañez, who chairs the House Treasury and Budget Committee—was approved with 44 votes in favor and three against, including votes by the minority New Progressive Party delegation, during the first day of the House’s seventh ordinary session.

The bill seeks to amend the Puerto Rico tax code to allow taxpayers to voluntarily keep tax reimbursements as credit for services and penalties related to license renovation, vehicle registration fees and traffic fines. Business owners would also be able to use said credits to pay for tariffs and permits related to their enterprise.

The mechanism seeks to provide an option in light of the delays that many taxpayers have experienced in receiving tax reimbursements. At the same time, the bill aims to give the Puerto Rico Treasury Department, commonly known as Hacienda, some much-needed breathing room amid a precarious fiscal picture for the commonwealth government.

Despite this, there has been public resistance to the bill, with Senate President Eduardo Bhatia saying he may vote against it when it moves up to the upper legislative chamber.

If approved and signed, the tax credit would apply to several government agencies, including the aforementioned Hacienda, the Office of Management & Budget, the Municipal Revenue Collection Center, and the departments of State, Transportation and Public Works, Health, Consumer Affairs and Labor and Human Resources.

By Dennis Costa

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