In addition to an income tax imposed to individuals and corporations, the Puerto Rico revenue system consists of a property tax (Commonwealth and municipal) and numerous excise taxes. An outline of these taxes follows.
Real Property Taxes112
Basis – Rates Due Date
Municipalities – authorized to levy a basic tax of up to 6 percent annually on the assessed value of real property located within their territorial limits.
Payment – Semiannually in advance on July 1 and January 1 of each year. The Municipal Revenues Collection Center collects both Commonwealth and municipal taxes.
Commonwealth – Special tax of 1.03 percent is levied on real property not exempt from taxation.
108 Id. Credits, High Technology Goods. 109 Id.
110 ERNST &YOUNG, supra note 46, at 25. 111 Id.
Alcoholic Beverages Tax113
Basis - Rates Due Dates and Payment Method
Distilled Spirits obtained from fermentation and distillation of any product other than those derived from sugar cane; below 100 degrees proof, $31.29 per measured gal.; 100 degrees proof or more, $31.29 per proof gal.
Distilled spirits obtained through fermentation and distillation of products derived from sugar cane: below 100 degrees proof, $15.12 per measured gal.; 100 degrees proof or more, $15.12 per proof gal.
Payment Method – By check or legal tender against receipts which have been correlatively and/or alphabetically pre-numbered.
Imported champagne and sparkling or carbonated wines – Not over 24 percent alcohol by volume, $13.75 per measured gal.; from must concentrated wines, $5.50 per measured gal.
Payment Due for Distillers – Before spirits are removed from distillery.
Payment Due for Rectifiers Receiving Distilled Spirits on Which No Taxes Have Been Paid - Before products are removed from bonded warehouse.
Payment Due for Manufacturers – Before
manufactured products are removed from factory. Payment Due for Distilled Spirits or Alcoholic Beverages Brought Into Puerto Rico – Before they are taken from the custody of the customs house, post office, express company, or any public or private carrier bringing them into Puerto Rico. Wines Not Over 24 percent alcohol by volume -
Substandard and imitation wines, $1.65 per measured gal.; imported wines and ciders, $11.35 per measured gal.; wines from tropical fruits, 62 cents per measured gal.; must concentrated wines, $4.13 per measured gal.
Beer, Malt Extract and Similar Products – ½ of 1 percent alcohol but not over 1½ percent alcohol, 70 cents per measured gal.; over 1½ percent alcohol - $4.05 per measured gal. if in containers holding less than 5 measured gal., $4.12 if in containers holding 5 or more measured gal.
Licenses - $15 to $7,200 based on classification of business.
Payment due at the time license is obtained or renewed, no later than October 31 of each year. Ten percent discount of license fees if payment is made between thefifteenth and the thirtieth day of September of the corresponding year.
Gasoline Tax114
Basis - Rates Due Date
Sixteen cents per gal.; aviation fuel 3 cents per gallon; 8 cents per gal. on gas oil or diesel oil.
Payment – At time gasoline is imported into Puerto Rico or upon first taxable event if refined in Puerto Rico.
Motor Vehicle Excise Taxes115
Basis - Rates Due Date
Automobiles, a tax ranging from 13 percent to 40 percent of the taxable price; truck tractors, 17 percent of taxable price; buses, 20 percent; trucks, 10 percent. Excise tax must be at least $750.
When imported into Puerto Rico or upon first taxable event if manufactured in Puerto Rico.
114 Id. at 6,364. 115 Id.
Admissions Tax116
Basis - Rate Due Date
Ten percent of admission fee. Person in charge of public show remits tax
collected to Secretary of Treasury on Tuesday of each week for all public shows held between.
Cigarette Tax117
Basis - Rate Due Date
Rated at $6.15 per 100 cigarettes. Before first taxable event. Extension of time not to exceed 15 days from date of delivery when cigarettes are imported from the U.S.
Other Excise Taxes118
Basis – Rate Due Dates
Articles – Sugar is taxed at 14 cents per pound. Articles that are not covered by a specific statute and are not exempt are taxed at 5 percent of Puerto Rico taxable price. Hydraulic cement is taxable at 6 cent per cwt.
For goods brought into Puerto Rico other than by mail, the tax must be paid before goods are delivered to taxpayer.
For goods brought into Puerto Rico by mail, the tax is payable no later than second working day
following day in which possession is taken. Tax on articles carried into Puerto Rico by person must be paid no later than second working day after day of arrival.
For articles of local manufacture, the tax is payable bytenth day of month following month in which first taxable event occurs.
Transactions – Occupancy (hotel rooms, apartment hotels, guest houses), 9 percent of occupancy rental.
If the hotel has a casino the rate is 11 percent. Sales of jewelry, 5 percent of the retail price. Winnings – Racing pools and any other gaming where races are held, 20 percent of the amount won.
Prizes won by horse owners in races, 6 percent of amount of each price.
Printed forms used in pool gamings at Puerto Rico hippodromes, 5 cents per betting form.
Transactions – Occupancy taxes are payable tenth day of each month.
Gambling winnings, prizes won by horse owners and printed forms for pool gaming are payable second working day following day races were held.
116 Id. 117 Id.
Insurance Companies Tax119
Basis - Rates Due Dates
Premium Tax – Life and Disability Insurances – 4 percent of premiums after deducting dividends, returned premiums and amounts refunded or the amount of reductions in premiums allowed to holders of industrial life policies for payment of premiums direct to an office of the insurer. Annuity Contracts – 1 percent of consideration received on direct business after deduction of dividends and returned annuity considerations. All other kinds of insurance or contracts – 4 percent of premiums after deducting returned premiums, except for certain types of insurers.
On or before March 31 of the subsequent taxable year to the Secretary of Treasury through the Commissioner of Insurance.
Estate and Gift Taxes120
Basis - Rates Due Dates
Tax range from 18 percent of the amount over which the tax is computed to $1,025,800 plus 50 percent of the excess over $2,500,000.
Estate tax payable within 270 days following the date of the decedent.
The gift tax is to be paid on or before April 15 of the calendar year following the one in which the gifts are made.
Unemployment Insurance Tax121
Basis - Rates Due Date
Employers covered under the Puerto Rico law, but not under the Federal Unemployment Tax Act pay on the first $7,000 of salary paid at a rate
determined by the amount of the Unemployment Fund and the amount of the employer’s reserve fund.
Paid through the Secretary of the Treasury for the Unemployment Fund.
119 Id.
120 Id. at 6,366. 121 Id.
C. Overview of U.S. Tax Provisions Relating to Other U.S. Possessions