Puerto Rico revenues up $190M in Dec., IVU falls short
Puerto Rico Treasury Secretary Melba Acosta released Thursday preliminary revenue numbers for December, totaling $913 million, up by $190 million, or 26 percent, compared to last year. The government official said this is the “highest revenue total for December to date.”
The preliminary totals also surpassed initial estimates by $1.3 million, she noted. Overall, the first half of this fiscal year (July-Dec.) surpassed revenues from last year by $525 million, or 15 percent. Actual revenues surpassed initial estimates for this period by $80 million.
In a statement, Acosta attributed the revenue increase to two principal sources: corporate income tax and the 4 percent tax increase on foreign companies, which was enacted this fiscal year.
Corporate income tax collections last month totaled $316 million, representing a $169 million jump, and more than double the amount collected in December 2012, of $147 million. The increase was caused by the new revenue measures enacted in Act 40 that introduced the inclusion of the gross profit tax, among others, she said.
“This increase in corporate income tax is even more relevant if we consider that on Dec. 18, 2013 a lawsuit was established by a Puerto Rico association of food distributors that questioned the constitutionality of the gross profit tax. On Dec. 31, 2013 the lawsuit was dismissed and the constitutionality of the tax was ratified,” she said.
“We noted that several taxpayers did not make the December payment of the gross profit tax, probably waiting to see the outcome of the case. Given the favorable decision upholding the constitutionality of the tax, we expect to receive additional payments during the current month of January 2014,” Acosta added.
As for the 4 percent tax increase on foreign companies, it shored up $177 million in revenue, or more than $61 million or 53 percent than last year, the agency’s report said.
Sales tax up, but still falls short
Sales and use tax (known as IVU in Spanish) revenues in December, reached $107.7 million, the highest amount since it was implemented in November 2006. The increase was $7.9 million, or 7.9 percent higher compared to last year. However, total fell short of estimates by $23 million, Treasury said.
In terms of excise taxes, motor vehicle taxes were similar to last year’s revenues, as well as taxes on cigarettes, which were similar to last year after subtracting $2.6 million that was transferred to the Highway Authority and the Metropolitan Bus Authority.
The withholding to non-resident corporations, which includes the tax imposed on royalties for the use of patents in the manufacturing industry’s production processes, registered a reduction of $50 million. This decrease is attributable to a non-recurrent payment made last year by a particular company.
“We can see the positive results of new tax legislation and administrative efforts. We will continue to monitor revenues closely and strengthen the fiscal measures so that we reach our goals,” Acosta said.