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Puerto Rico VAT 10.5% June 2016

  • May 19, 2016 | Richard Asquith

Puerto Rico VAT 10.5% June 2016

The Puerto Rican Treasury Department has confirmed further details on the new VAT regime to be introduced.

The new VAT rate will be 10.5%. The implementation date will be 1 June 2016, and will replace the existing Sales & Use Tax. The VAT registration threshold will be $125,000.

The current Municipal Tax of 1% will remain, and will be charged on top of VAT on certain goods and services.

Assembly challenges VAT implementation

The government's plans to introduce VAT, as part of the conditions to secure new funding from the IMF, has not gone to plan.  There have already been a number of delays to its implementation.  On the 5 May, the latest challenge to the imposition of VAT came from the Senate.  It has put up a Replacement Bill which would withdraw the planned June launch.

VP Global Indirect Tax
Richard Asquith
VP Global Indirect Tax Richard Asquith
Richard Asquith is VP Global Indirect Tax at Avalara, helping businesses understand their compliance obligations as they grow globally. He is part of the European leadership team which won International Tax Review's 2020 Tax Technology Firm of the Year. Richard trained as an accountant with KPMG in the UK, and went on to work in Hungary, Russia and France with EY.