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Fiscal Agency and Financial Authority of Puerto Rico (AAFAF) issues Administrative Order to stop granting a number of new tax credits

March 8, 2017

 

 

Yesterday, the Government of Puerto Rico through the Fiscal Agency and Financial Authority of Puerto Rico (AAFAF) issued Administrative Order number OA-2017-01.
 
The following was established by means of the aforementioned order: 

 

  1. The Authority, on behalf of the Government of Puerto Rico, orders the prescription of all the new obligations related to the Special Multi-Annual Assignments from the fiscal years previous to fiscal year 2017.

  2. The Authority, on behalf of the Government of Puerto Rico, orders to stop the granting of new tax credits authorized by diverse laws that grant said tax credits, including but not limited to the following laws:

 

  • Law 78-1993, known as the “Tourism Development Act of Puerto Rico”

  • Law 46-2000, known as the “Capital Funds Investment Act”

  • Law 98-2001, known as the “Tax Credits for Extraordinary Investment in Housing Infrastructure Act "

  • Law 140-2001, known as the “Construction or Rehabilitation of Social Interest Housing Units Act”

  • Law 183-2001, known as the “Puerto Rico Conservation Easements Act”

  • Law 212-2002, known as the “Renewal of Urban Centers Act”

  • Law 73-2008, known as the “Act of Economic Incentives for the Development of Puerto Rico”

  • Law 74-2010, known as the “Puerto Rico Tourism Development Act”

  • Law 27-2011, known as the “Puerto Rico Economic Incentives for the Film Industry Act”

  • Law 159-2011, known as the “Act of Tax Incentives for the Investment in Facilities of Reduction, Disposal and/or Treatment of Solid Waste”

  • Law 302-2012, that amends the Code of Internal Revenue to grant a tax credit to donations to foundations of former governors, among others.

  • Law 77-2015, known as the “Act of Tax Credits for Investment in the Construction or Rehabilitation of Housing Units for Rent to Low or Moderate Income Households and of Tax Credits for Investment in the Acquisition, Construction or Rehabilitation of Affordable Housing for Rent to Older People”

  • Sections 1051.09, 1051.07, 1052.03   and 4050.10 of the Law 1-2011, known as the “Code of Internal Revenue of Puerto Rico from 2011”

 

On the other hand, the order also establishes the Committee for the Authorization of Disbursements and Tax Concessions with the following members:

 

  • The Executive Director of the Authority of Financial Advisory and Fiscal Agency or its delegate, who shall preside it

  • The Secretary of the Department of the Treasury or its delegate

  • The Executive Director of the Management and Budget Office or its Delegate.

 

The Order delegates to the Committee for the Authorization of Disbursements and Tax Concessions:

 

  • The responsibility of analyzing and awarding the requests for approval and disbursements corresponding to the Special assignments of the Previous years to the current one.

  • The Authority to evaluate the requests for tax credit submitted and not authorized to the date of this Administrative Order.

  • The power to establish limitations to the use of the credits granted, and limit the time of use of said credits up to a maximum of four (4) fiscal years.

  • The Authority to receive and evaluate the new requests for tax credits authorized by the laws of Puerto Rico, including the laws quoted in administrative order, and to approve said requests and grant the corresponding tax credits.

 

To these purposes, it orders the Secretary of the Treasury to carry out an inventory of the tax credits granted and to require to the holders of credits to inform the amount of such credits granted, in the form and manner indicated by the Secretary of the Treasury for said purposes. Any credit holder who overlooks the obligation of showing evidence issued by the Secretary of the Treasury concerning the compliance of the aforementioned information requirement shall be unable to claim said credits.

 

 

 

 

 

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