United States

Puerto Rico: VAT Repealed; Lawmakers Override Governor’s Veto of VAT Repeal Legislation

May 30, 2016
From KPMG TaxWatch

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The legislature of Puerto Rico has voted to override the Governor’s veto of a bill to repeal the value-added tax (VAT) regime that was scheduled to become effective June 1, 2016. Thus, the Commonwealth’s existing sales and use tax system (known as “IVU”) will continue to apply.

On Friday, May 20, the Governor had vetoed a bill to repeal the VAT system. On May 26, 2016, the Puerto Rico Senate, following a vote by the House of Representatives of Puerto Rico earlier in the week, voted to override the governor’s veto. The votes in both houses reached the required two-thirds majority to override the veto. Please stay tuned to TWIST for more information on Puerto Rico’s tax system.

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The following information is not intended to be "written advice concerning one or more federal tax matters" subject to the requirements of section 10.37(a)(2) of Treasury Department Circular 230.

The information contained herein is of a general nature and based on authorities that are subject to change. Applicability of the information to specific situations should be determined through consultation with your tax adviser.