Breaking News: Puerto Rico Treasury Moves to Suspend VAT Implementation

Elizabeth Quintana
March 10, 2016

This blog was last updated on August 4, 2021

VAT Now Scheduled to Take Effect on June 1, 2016

Puerto Rico’s Treasury Department issued Administrative Determination DA16-04 on March 8, 2016, officially postponing the effective date of the VAT (IVA in Spanish) from April 1, 2016, until June 1st, 2016 and may suspend VAT implementation altogether. According to the Treasury Department, the delay was effectuated, in part, to allow the Legislature and Governor’s Office time to review new proposals regarding a number of alternative tax reform measures that may supplement, or possibly completely scrap, the VAT. The move was also clearly in response to concerns expressed by many businesses operating in Puerto Rico regarding their ability to comply with the VAT requirements by April 1. This latest notification also indicates that all new businesses, or businesses seeking to renew certifications that expired as of December 31, 2015, should do so according to the procedures currently in place under the existing sales tax law. As of March 1, 2016, the Department is not accepting any applications to renew certificates that expire during 2016. This includes the Re-seller for Municipal IVU Exemption Certificate, Certificate for Exemption to Manufacturing Plants, and the Certificate for Eligible Re-sellers. Any certificate expiring in 2016 can continue to be used until such time as the Department of Treasury announces new requirements and procedures. Any prior notices issued by the Department contrary to the information provided in DA 16-04 is no longer considered valid. To that end, the Notice specifically provides that the information contained in DA 15-26 regarding the implementation of the VAT on April 1 should be considered void. Likewise, DA 16-01 should be considered partially void to the extent that the current notice provides contrary instructions. Stay tuned as we continue to monitor developments related to the implementation of a VAT (or other tax reforms) in the Commonwealth of Puerto Rico.

Sign up for Email Updates

Stay up to date with the latest tax and compliance updates that may impact your business.

Author

Elizabeth Quintana

Share this post

Hungary Supplemental Insurance Premium Tax
EMEA IPT
July 11, 2022
Extra Profit Tax: An Introduction to Supplemental IPT in Hungary

This blog was last updated on October 28, 2024 Update 7 October 2024 by Edit Buliczka Hungarian Tax Office Updates IPT Declaration Form for 2023 The procedure necessary to correct an underdeclared premium figure in Hungary can be complicated. The complexity of a correction for return form 2320 has become even more challenging. Following a […]

E-Invoicing Compliance EMEA VAT & Fiscal Reporting
November 1, 2024
New ViDA Proposal Set for ECOFIN Approval

This blog was last updated on November 1, 2024 The Council of the European Union has released a new proposal regarding the VAT in the Digital Age (ViDA) reform. The proposal aims to modernise and streamline VAT systems across the EU, notably e-invoicing and Continuous Transaction Controls (CTC). Members States will review it on 5 […]

what is peppol
E-Invoicing Compliance North America
October 29, 2024
What it is PEPPOL?

This blog was last updated on October 29, 2024 Peppol E-invoicing explained: What it is and how it works The global adoption of electronic invoicing is accelerating. Governments worldwide are pushing to adopt e-invoicing to digitally transform their national systems and, often, to close the VAT gap. While many countries have introduced their own e-invoicing […]

remote sellers sales tax
North America Sales & Use Tax
October 28, 2024
Will Congress Act to Simplify Remote Seller Sales Tax Collection

This blog was last updated on October 29, 2024 When the United States Supreme Court ruled in 2018, that South Dakota’s law imposing sales tax collection requirements on sellers without in-state physical presence was constitutional, it did not grant states free reign. States are still responsible for ensuring that their sales tax requirements are manageable, […]

dtc shipping laws for craft spirits
North America ShipCompliant
October 23, 2024
Why It’s Time to Reform DtC Shipping Laws for Craft Spirits

This blog was last updated on October 23, 2024 While wine lovers have enjoyed the convenience of direct-to-consumer (DtC) shipping for nearly two decades, the craft spirits market is still not afforded the same access. Outdated and restrictive spirits shipping laws have kept the spirits industry from fully leveraging the benefits of DtC shipping, leaving […]

reporting unclaimed property
North America Unclaimed Property
October 21, 2024
Three Key Reminders for Businesses Reporting Unclaimed Property

This blog was last updated on October 21, 2024 Unclaimed property compliance is one of those legal obligations that often flies under the radar for many businesses, especially smaller ones. However, failing to stay compliant can quickly turn minor oversights into major liabilities. In many cases, the penalties far exceed the value of the property […]