Puerto Rico Releases Guidance on Upcoming Sales Tax Changes

Wednesday, June 24th, 2015

 
 
Puerto Rico Department of Revenue
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Puerto Rico
General

The Puerto Rico Department of Treasury has released guidance on the changes that will take effect under Act 72-2015.

Effective July 1, 2015, the state portion of the tax rate will be increased to 10.5%. This means that the combined rate (with the municipal tax of 1%) will be 11.5%. Contracts that existed before July 1, 2015 will be exempt from the new higher tax rate for 12 months. Additionally, products and services acquired for construction projects beginning before May 30, 2015 will be exempt from the rate increase. Also effective July 1, 2015, resellers will be able to claim a credit for tax paid on resold items up to 100% of the tax owed on their monthly returns. Previously, resellers were only allowed to claim a credit of up to 75% of the tax owed on their monthly returns.

Effective October 1, 2015, business-to-business services and professional services will be subject to sales and use tax at a reduced rate of 4%. Prior to this date, business-to-business services were exempt from tax unless they were specifically listed as taxable, and professional services were excluded from the definition of taxable services.

Effective April 1, 2016, a Value Added Tax system (VAT) will take effect.

http://ttrus.com/sites/default/files/pr/P.R.%20Informative%20Bull.%20No.%2015-09.pdf


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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

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