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Caguas, Puerto Rico – Resident Commissioner, Luis Fortuño, announced during a visit to a Pfizer manufacturing plant in Caguas, that he has filed a bill (H.R 763) in the House of Representatives, to make the amendment to section 199 of the Internal Revenue Code permanent. This amendment, which was approved in the 109th Congress at the request of Fortuño, ensures equal tax treatment to manufacturing operations in Puerto Rico that are subsidiaries of stateside companies.
In December of last year, Congress approved the amendment to Section 199 as part of a tax incentive legislative package. The amendment to Section 199 reduced the effective federal tax rate that manufacturing subsidiaries of stateside companies pay for their manufacturing operations in Puerto Rico, from 35% to 32%. This amendment is only effective for a two year period, since Puerto Rico was not included when the Job Creation Act of 2004 was originally approved in Congress when Aníbal Acevedo-Vilá was Resident Commissioner.
Last year, in December, Congress approved an amendment to section 199 as part of a legislative contributory incentive to the Nation. The amendment to section 199 reduced the contributive rate that subsidized manufacturing companies pay in Puerto Rico; from a 35 to 32%. This amendment will be in use for only two years, since Puerto Rico wasn’t included in the creation of the Employment Bill of 2004 which was originally approved in Congress during the time Aníbal Acevedo- Vilá was resident commissioner.
“The amendment to section 199 represents the first time in 30 years that Congress approves a new economic incentive for Puerto Rico,” indicated Fortuño, who was accompanied by Congressman John Boehner (R-OH), leader of the Republican minority in the House of Representatives.
The Resident Commissioner thanked Pfizer, and other manufacturing companies in Puerto Rico, for their support and cooperation during the complicated legislative process that the economic tax incentive faced in Congress. “The approval of the amendment to section 199 is a shared success that would never have been possible without the support of our manufacturing industry and my friends in the Congressional leadership at the time, including Congressman Boehner.” Fortuño is counting on the support of the manufacturing industry on the Island to secure the permanence of this economic incentive.
“I was able to correct Puerto Rico’s exclusion from the tax reduction bill in 2004, which left us at a disadvantage with manufacturing operations in the states, but I will not rest until this disadvantage is permanently eliminated,” Fortuño commented. “I am determined to obtain results in Congress that will help with economic development on the Island, that will protect existing jobs, and that will create new employment opportunities in the private sector,” Fortuño concluded.
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