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Gov. Ricardo Rosselló declares Puerto Rico is ‘Open for Business’
February 15, 2018
NEW YORK- Today, the Governor of Puerto Rico, Ricardo Rosselló, alongside the Puerto Rico Department of Economic Development and Commerce (DDEC) and other visionary business leaders who have made Puerto Rico home to their global-reaching companies, gathered at the “Pathway to the Future: Opportunities of an Economic Transformation” forum in New York City, hosted in alliance with the Financial Times, to officially announce that Puerto Rico is “Open for Business.”
During this transformative moment for Puerto Rico, the current administration has implemented innovative initiatives and aggressive local tax benefits to attract inbound investment as they reconstruct the Island’s economy and infrastructure, and build a stronger, better Puerto Rico.
As Puerto Rico seeks to move forward, many companies, ranging from multinational corporations to small and medium-sized enterprises, innovative start-ups and high-net worth investors, continue to call Puerto Rico home. Companies like Microsoft, Lufthansa, Bacardi, Medtronic, Amgen and Sartorious have long invested in Puerto Rico and are committed to continuing to do so. Others, including Tesla and Google, are investing in the Island’s recovery – from innovation to renewable energy – helping to revitalize the Island’s future. Companies engaged in the development and commercialization of blockchain technology, like Blockchain Industries, are investing in software development and exporting and commercializing intellectual property with Puerto Rico as their global hub. By creating a resilient electrical grid, partnering with the private industry to modernize infrastructure, implementing island-wide broadband, and updating health care and skills education systems, a stronger Puerto Rico with a thriving economy will yield tremendous opportunities.
“As we look to rebuild, strong collaboration with the federal government and the private sector will be critical to creating a stronger and better Puerto Rico as we look to modernize energy systems, waterways, highways and ports. Puerto Rico has the opportunity to use recent public-private partnership successes, like our Luis Muñoz Marín International Airport (SJU), that recently won gold for best operational project at the P3 Awards, as a model to embark on its economic transformation in technology, infrastructure and health care,” said Governor Rosselló.
To promote export services, attract individual investors and foster innovative start-ups, Puerto Rico also offers unparalleled incentives including:
- Act 20: Provides for key services and activities a 4% income tax rate, 100% tax exemption on distributions from earnings and profits, and a 90% exemption from personal property taxes for certain types of businesses.
- Act 22: Provides 100% exemption from income taxes on all dividends, interest, and capital gains for bona-fide residents on income made in Puerto Rico. This is especially attractive to individuals looking to personally relocate to Puerto Rico.
- Act 273: Provides tax exemptions to business who qualify as an “International Financial Entity,” who apply and obtain a decree. Once a company qualifies as an IFE, it becomes eligible for other financial incentives.
- Act 399: Provides a competitive environment for reinsurers to cover risks in and out of Puerto Rico under a secure and flexible regulatory system. Additionally, it provides for the exemption from premium taxes, dividends and other profits, municipal property taxes, and more.
As Puerto Rico recovers, key government officials are reiterating the Island’s commitment to opportunities for business and investment. The job creation requirements for companies exporting services from the island were removed and federally funded technology start-ups are now eligible to earn research and development tax credits. At the same time, a streamlined application and compliance process for new residents to receive tax exemption on passive assets with a firm commitment to process applications in 30 days or less has been put into place.
“Now is the time to invest in Puerto Rico,” said Manuel Laboy, Secretary of the Department of Economic Development and Commerce. “Puerto Rico’s strongest economic assets – our people, our resiliency, our location and our incentives are all intact – and we now have the opportunity to add to these assets with new, state-of-the-art systems to power the next phase of our story. Our incentives for investors are unparalleled and our workforce is highly educated. Combined with the protection of the U.S. jurisdiction, we recently updated our incentive laws to make it even easier for potential investors to take advantage of our aggressive local tax benefits”.
Beyond these unmatched incentives, Puerto Rico also provides a quality of life like no other major metropolitan areas in the U.S. The cost of living is far below average metropolitan areas, and with key communities located on the coast, the Island offers a balanced approach to the boundaries between work and play. Its diverse and highly educated, bilingual workforce with a vast knowledge in U.S. and global regulations adds to the Island’s many assets.
Timed with today’s forum is the launch of Invest Puerto Rico, a not-for-profit corporation with a mission to promote a vigorous and growing state economy, encourage business investment in Puerto Rico, improve trade relations with other jurisdictions, and foment job creation across Puerto Rico through the efficient use of tax incentives, credits, grants, marketing, and other forms of economic tools. Working closely with the DDEC, and alongside the private sector, Invest Puerto Rico will look to strengthen the Island’s investment brand and continue to convey the unique value proposition that Puerto Rico has to offer.
About the Puerto Rico Department of Economic Development and Commerce (DDEC)
The Government of Puerto Rico, through its Department of Economic Development and Commerce (DDEC) is spearheading Puerto Rico’s economic transformation, writing a new chapter in the Island’s history by setting the foundation for the creation of next-generation infrastructure. Through a series of alliances and partnership with private and public sector entities, DEDC is working to encourage and increase investment, entrepreneurship and enterprise on the Island, strengthening Puerto Rico’s idyllic position as a U.S. jurisdiction like no other that fully supports the endeavors of multinationals, small- and medium-enterprises, and innovative start-ups in myriad fields, including health, innovation, technology and infrastructure.
To achieve this, the DDEC is actively developing processes to manage incoming funding efficiently, updating current incentive laws to make it easier for potential investors to take advantage of local tax benefits, fostering collaborations between local and federal governments and the private sector, and enacting bold fiscal and reform strategies. These undertakings work in tandem with DDEC’s daily objectives: implement and supervise the Island’s economic development policies; promote a stable and sustainable private sector; transition the current economy to the global stage; support strategies that incentivize investment, create jobs and improve the quality of life on the Island.
DDEC has the full support of the Government of Puerto Rico to take the necessary steps to create a 21st century business ecosystem in Puerto Rico and send a clear message to the world: Puerto Rico is Open for Business.