The Puerto Rico Sales and Use Tax (SUT, Spanish: Impuesto a las Ventas y Uso, IVU) is the combined sales and use tax applied to most sales in Puerto Rico. The tax is composed of two portions: 1.0% that belongs to the municipality where the sale was executed, and 10.5% that belongs to the state government. Furthermore, half of the portion that belongs to the state government is destined to the Urgent Interest Fund Corporation (COFINA) to pay the public debt of Puerto Rico, making it a three-tier tax. The amount of the tax changes from 11.5% to 7% when you buy prepared food on restaurants, foodtrucks, fast foods, or on any certified 7% tax prepared food establishment.
On July 4, 2006, the government approved Law Number 117, The 2006 Contributive Justice Law, establishing a tax with a 5.5% rate at state level and an optional 1.5% rate at municipal level. The tax went into effect on November 15, 2006. The tax is better known as the Sales and Use Tax' (Impuesto sobre Ventas y Uso), often referred to by its Spanish acronym "IVU". The law amended Article B of the Code and created sub-article BB. On July 29, 2007, the government approved Law Number 80, making the tax mandatory for all municipalities of the commonwealth. Also the tax rates changed to 6% at the state level and 1% at the municipal level.
The tax originated in some municipalities (Caguas, Yauco and Villalba) in 2005. Seeing the economic success of these municipalities, many other municipalities enacted sales tax ordinances, usually by copying the ordinance of Caguas. By the middle of 2006, more than 30 municipalities had enacted sales and uses taxes in the commonwealth.
During the second and third quarters of 2006, the Commonwealth of Puerto Rico suffered several political struggles in its Legislative Assembly. These were largely caused of the budget deficit of the government and the refusal of the Legislative Assembly to approve the taxes proposed by the Governor of the Island. Government offices were shut down until the Assembly approved the law 117 which included the first sales tax of that possession of the United States.
On July 1, 2006, the first Commonwealth-wide sales tax was approved with a 5.5% rate at state level and an optional 1.5% rate at municipal level. The adoption of the municipal tax was mixed. The tax went into effect on November 15, 2006.
Since the tax reform of July 2007, the tax is applied in all 78 municipalities and at Commonwealth level. The tax rates are 6% at the state level and 1% at the municipal level.
On February 6, 2008 the governor of Puerto Rico proposed to remove the state part of the IVU.
Puerto Rico, officially the Commonwealth of Puerto Rico and from 1898 to 1932 also called Porto Rico in English, is an unincorporated territory of the United States located in the northeast Caribbean Sea, approximately 1,000 miles (1,600 km) southeast of Miami, Florida.
The government of Puerto Rico is a republican form of government with separation of powers, subject to the jurisdiction and sovereignty of the United States. Article I of the Constitution of Puerto Rico defines the government and its political power and authority pursuant to U.S. Pub.L. 82–447. Said law mandated the establishment of a local constitution due to Puerto Rico's political status as a commonwealth of the United States. Ultimately, the powers of the government of Puerto Rico are all delegated by Congress and lack full protection under the U.S. Constitution. Because of this, the head of state of Puerto Rico is the President of the United States.
Caguas, founded in 1775, is a city and municipality of Puerto Rico located in the Central Mountain Range of Puerto Rico, south of San Juan and Trujillo Alto, west of Gurabo and San Lorenzo, and east of Aguas Buenas, Cidra, and Cayey.
The municipalities of Puerto Rico are the second-order administrative divisions in the Commonwealth of Puerto Rico. There are 78 such administrative divisions covering all 78 incorporated towns and cities. Each municipality is led by a mayor and divided into barrios, though the latter are not vested with any political authority. Every municipality is governed by the Autonomous Municipalities Act of 1991, which establishes that every municipality must have an elected strong mayor with a municipal legislature as the form of government. Each legislature must be unicameral, with the number of members related to adequate representation of the total municipality's population. In contrast to other jurisdictions, both the mayors and the municipal legislators are elected on the same date and for the same term of office.
The Constitution of the Commonwealth of Puerto Rico is the controlling government document of Puerto Rico. It is composed of nine articles detailing the structure of the government as well as the function of several of its institutions. The document also contains an extensive and specific bill of rights. Since Puerto Rico is a commonwealth of the United States, two authorities may override the Puerto Rico Constitution: the U.S. Constitution due to the Supremacy Clause, and relevant federal legislation due to the Territorial Clause.
The Legislative Assembly of Puerto Rico is the territorial legislature of the Commonwealth of Puerto Rico, responsible for the legislative branch of the government of Puerto Rico. The Assembly is a bicameral legislature consisting of an upper house, the Senate normally composed by 27 senators, and the lower house, the House of Representatives normally composed by 51 representatives. Eleven members of each house are elected at-large rather than from a specific legislative district with all members being elected for a four-year term without term limits.
The 2006 Puerto Rico budget crisis was a political, economic, and social crisis that saw much of the government of Puerto Rico shut down after it ran out of funds near the end of the 2005–2006 fiscal year. The shut down lasted for two weeks from 1 May 2006 through 14 May 2006, leaving nearly 100,000 public employees without pay and closing more than 1,500 public schools.
The Internal Revenue Code of Puerto Rico is the main body of domestic statutory tax law of Puerto Rico organized topically, including laws covering income taxes, payroll taxes, gift taxes, estate taxes, and statutory excise taxes.
The economy of Puerto Rico is classified as a high income economy by the World Bank and as the most competitive economy in Latin America by the World Economic Forum. The main drivers of Puerto Rico's economy are manufacturing, primarily pharmaceuticals, textiles, petrochemicals, and electronics; followed by the service industry, notably finance, insurance, real estate, and tourism. The geography of Puerto Rico and its political status are both determining factors on its economic prosperity, primarily due to its relatively small size as an island; its lack of natural resources used to produce raw materials, and, consequently, its dependence on imports; as well as its relationship with the United States federal government, which controls its foreign policies while exerting trading restrictions, particularly in its shipping industry.
Aníbal Salvador Acevedo Vilá is a Puerto Rican politician and lawyer. He served as Governor of Puerto Rico, a Commonwealth of the United States, from 2005 to 2009. He is a Harvard University alumnus and a graduate of the University of Puerto Rico School of Law, where he obtained his Juris Doctor degree. Acevedo Vilá has held various public service positions in the Puerto Rico government under the Popular Democratic Party, serving as a member of the House of Representatives of Puerto Rico (1993–2001) and as the 17th Resident Commissioner (2001–2005), before he was sworn in as Governor on 2 January 2005. Acevedo Vilá was also a member of the National Governors Association, the Southern Governors' Association and the Democratic Governors Association, and a collaborator of President Barack Obama's presidential campaign. Also he is currently an adjunct professor of the University of Puerto Rico School of Law. In 2019 he announced he would run for Resident Commissioner of Puerto Rico in the 2020 elections by the Popular Democratic Party.
The Commonwealth of Puerto Rico is a territory of the United States and Puerto Ricans are US citizens. However, Puerto Rico is not a US state. As a result of this, only Puerto Rico residents who are federal government employees, and those with income sources outside of the territory, pay federal income tax. All other employers and employees pay no federal income taxes. However, residents of Puerto Rico and businesses operating in Puerto Rico do pay some federal taxes, and the commonwealth's government has its own taxes as well.
As of 2012, the real estate industry in Puerto Rico constituted about 14.8% of the gross domestic product of Puerto Rico, about 1% of all of the employee compensation on the island and, together with finance and insurance (FIRE), about 3.7% of all the employment on the jurisdiction.
Ivu or IVU may refer to:
Alejandro Javier García Padilla is a Puerto Rican politician and attorney who served as governor of Puerto Rico from 2013 to 2017. Prior to this position, García Padilla held various roles in the political landscape of Puerto Rico; first as Secretary of Consumer Affairs, and then as a member of the 24th Senate of Puerto Rico and as president of the Popular Democratic Party. Locally, he is a staunch advocate for maintaining the current political status of Puerto Rico as that of an unincorporated territory of the United States with self-government, while at the national level he is allied with the Democratic Party.
The mayors of Puerto Rico encompass the different mayors of the municipalities of Puerto Rico; each mayor being the highest-ranking officer of their corresponding municipality. Several laws existed that created the post of mayor in each municipality but they were all repealed in favor of a broad and encompassing law known as the Autonomous Municipalities Act of 1991.
The executive branch of the government of Puerto Rico is responsible for executing the laws of Puerto Rico, as well as causing them to be executed. Article IV of the Constitution of Puerto Rico vests the executive power on the Governor—whom by its nature forms the executive branch.
The Puerto Rico Sales Tax Revenue Bonds are government bonds issued by the Urgent Interest Fund Corporation (COFINA) to pay the extraconstitutional public debt of Puerto Rico. The bonds are primarily used to provide funds to the government of Puerto Rico to repay certain debt obligations to the Government Development Bank and the Public Financing Corporation. They are issued under resolutions adopted by COFINA's board of directors will be payable from and secured by a security interest created by the Resolution in a specified portion of the Puerto Rico Sales and Use Tax.
The Puerto Rican government-debt crisis is a financial crisis affecting the government of Puerto Rico. The crisis began in 2014 when three major credit agencies downgraded several bond issues by Puerto Rico to "junk status" after the government was unable to demonstrate that it would be able to pay its debt. The downgrading, in turn, prevented the government from selling more bonds in the open market. Unable to obtain the funding to cover its budget imbalance, the government began using its savings to pay its debt while warning that those savings would eventually be exhausted. To prevent such a scenario, the United States Congress enacted a law known as PROMESA, which appointed an oversight board with ultimate control over the Commonwealth's budget. As the PROMESA board began to exert that control, the government sought to increase revenues and reduce its expenses by increasing taxes while curtailing public services and reducing government pensions. Those measures further compounded the crisis by provoking social distrust and unrest. In August 2018, a debt investigation report of the Financial Oversight and Management Board for Puerto Rico reported the Commonwealth had $74 billion in bond debt and $49 billion in unfunded pension liabilities as of May 2017.
A value-added tax (VAT), known in some countries as a goods and services tax (GST), is a type of tax that is assessed incrementally. It is levied on the price of a product or service at each stage of production, distribution, or sale to the end consumer. If the ultimate consumer is a business that collects and pays to the government VAT on its products or services, it can reclaim the tax paid. It is similar to, and is often compared with, a sales tax.
The Roads in Puerto Rico are the national, forest and municipal roadways that make up the approximately 14,400 kilometers (8,900 mi) roads through the terrain of Puerto Rico. The highways serve the more than 3 million residents, and 3-4 million tourists who visit each year.
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