Treasury Secretary Disapproves of Anti-VAT and B2B Talk
SAN JUAN—Puerto Rico Treasury Secretary Juan Zaragoza has frowned upon Popular Democratic Party (PDP) President and gubernatorial candidate David Bernier’s recent proposal to eliminate the implementation of the value-added tax (VAT) and the increase of the business-to-business (B2B) tax from 4% to 11%, both slated for June 1.
“I would prefer for the full VAT implementation to take place since are practically working under that system already,” Zaragoza said Thursday in response to Bernier’s proposal. The PDP-led Legislature approved the measures under controversy last year despite the opposition of minority delegations from the New Progressive Party (NPP) and the Puerto Rican Independence Party, as well as various sectors of commerce and industry.
Zaragoza said that if the Legislature decides otherwise, the agency would have to abide by what is approved; however, it is still working under the current mandate to implement the VAT, replacing the current sales tax-based system, and increase the B2B tax.
The official noted that most countries around the world use the VAT system, which constitutes a fairer system from the taxpayers’ perspective mostly because it is purely based on consumption.
On the other hand, Senate President Eduardo Bhatia and House Speaker Jaime Perelló reacted favorably to Bernier’s proposal and said they would consider carrying out such changes in the coming weeks.