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Governor of Puerto Rico warns that American citizens residing on the Island need equal treatment in Congress

Governor of Puerto Rico warns that American citizens residing on the Island need equal treatment in Congress

(November 13, 2017 – Washington, DC) The governor of Puerto Rico, Ricardo Rosselló, urged Congress to consider Puerto Rico in the federal tax reform and to include the Island in the Supplemental Disaster Relief Package that will attend the different natural disasters registered in the nation to ensure equal treatment for American citizens residing on the Island.

The chief executive warned that if Congress does not consider Puerto Rico as a jurisdiction of the United States in tax matters, it will cause the exodus of companies that generate 42% of the Gross Domestic Product (GDP), the loss of jobs on the Island, and therefore more Puerto Ricans moving to the mainland, causing an increase in the expenses to other states.

At the same time, Rosselló explained that the passage of hurricanes Irma and Maria devastated the public and private infrastructure of Puerto Rico, causing multi-million dollar losses estimated at 94 billion dollars.

According to the request of federal assistance for disaster recovery that will be presented today to the White House and Congress, 472,000 housing units were destroyed or damaged after the passage of Hurricane Maria.

In addition, the document presents an evaluation of the impact on the electricity system, the health system, agriculture, social services, economic development, communications infrastructure, roads and bridges, ports, and airports.

At the same time, damages have been estimated for the structures that house public agencies; the water facilities and water quality control; the sanitary sewer and drainage system; the schools and the education system; natural and environmental resources; as well as the coordination of public safety and emergency response.

In a letter attached to the request of federal assistance for disaster recovery sent to the president of the United States, Donald J. Trump, governor Rosselló said, "the scale and scope of the catastrophe in Puerto Rico after Hurricane Maria have no historical precedent. The devastation throughout the Island represents an extraordinary challenge for American citizens residing in Puerto Rico and for the federal Government. A challenge that I am sure we can overcome because the United States is the undisputed world leader in the response to disasters and because the determination of the people of Puerto Rico is powerful."

Meanwhile, in tax matters, the chief executive pointed out that the jobs created in Puerto Rico are American jobs. Therefore, to promote the creation of jobs and the economic development of the Island, it is necessary to ensure that the federal tax reform establishes that:

1. Products manufactured in Puerto Rico, which are imported into the United States, are domestic products. Therefore, the proposed excise tax of 20% for merchandise manufactured abroad should not apply.

2. The repatriation tax for profits invested in Puerto Rico should not apply to domestic companies that employ American citizens in the Island, as long as they have a commitment to remain operating in Puerto Rico for a minimum of 8 years and maintain more than 50% of their assets, tangible and intangible, on the Island.

3. Taxes whose purpose is to avoid the erosion of the United States tax base (minimum annual contribution) should not to apply to Puerto Rico, because the Island must be considered as part of the American nation.

Portal sometido ante la CEE el 28 de diciembre de 2015: Solicitud CEE-SA-16-2859