Sunday, November 17, 2019

Puerto Rico Treasury announces higher revenue for August, September

By on October 30, 2019

The Puerto Rico Treasury building in San Juan (CB file)

First quarter revenue rose 25.1% Secretary Parés stressed

SAN JUAN – Puerto Rico Treasury Secretary Francisco Parés Alicea said Tuesday that preliminary net revenues to the island’s General Fund in August and September totaled $773.6 million and $985.5 million, respectively, a year-over-year increase of $103.3 million in August and $152.5 million in September.

“The first quarter ended with revenues that totaled $2.81 billion. Compared to the same period during the previous fiscal year, this reflects an increase of $563.4 million, or 25.1 percent,” the secretary said in a release.

Corporate income tax was the main revenue driver, amounting to $924.9 million in the July-September period, a $524 million rise during that period. “This increase is due in part to a non-recurring capital gains transaction for a considerable amount made by a corporate entity,” Treasury’s release reads.

Another revenue category responsible for the increase in the first quarter was individuals’ income tax.

“During the first three months of the fiscal year, revenues in this category totaled $445.9 million, a year-over-year increase of $67.5 million. This reflects an improvement in this category during these first months, which was anticipated by other employment and participation indicators that reflect an encouraging behavior in the economy. This confirms that the public policy efforts led by Governor Wanda Vázquez Garced have contributed to this positive environment,” Parés Alicea said.

The official explained that fiscal year-to-date sales and use tax (IVU by its Spanish acronym) revenue totaled $287.9 million a $12 million year-over-year decline that “mainly reflects a change in the way that collections are recorded,” Treasury said.

“The implementation of a new methodology to report IVU collections,” Treasury added, “involves the publication of a new report, which presents the July to September periods for this fiscal year and includes the changes required by the Sales Tax Financing Corp. (Cofina by its Spanish acronym) bond restructuring and Cofina’s Third Amended Plan of Adjustment under Title III of PROMESA,” or the Puerto Rico Oversight Management and Economic Stability Act.

The secretary explained that one of the main differences of this new methodology is the “biweekly payments pending the filing of returns and overpayments by large taxpayers; therefore, the reduction with respect to the prior fiscal year is attributed mainly to the discrepancy between periods with different methodologies.”

Meanwhile, fiscal year-to-date (July-September) excise tax revenues totaled $811.4 million, a year-over-year increase of $20.5 million.

The revenue reflected in the “other excise taxes” category is from payments related to cigarettes and tobacco products, itemized as “other excise taxes” because “taxpayers’ declaration are pending,” Treasury said.