​SUMMARY OF MAIN PUERTO RICO INCENTIVES

AGGRESSIVE TAX INCENTIVES

PUERTO RICO PROVIDES TAX INCENTIVES, TAX CREDITS AND CASH GRANTS

Export Services:  Puerto Rico has a highly educated and professional labor force that can fulfill the labor market demands for the provision of export services. In 2012, Puerto Rico approved ground breaking incentives in Act 20 of 2012 with the intention on developing Puerto Rico as an international export services center, diversifying the drivers of economic growth by encouraging local service providers to expand their services to persons outside of Puerto Rico, and attracting new business to Puerto Rico. 
 
Individual Investors:  Puerto Rico also offers attractive tax incentives for individuals that relocate to Puerto Rico through Act 22 of 2012. This law seeks to attract new residents to Puerto Rico by providing a total tax exemption from Puerto Rico income taxes on all passive income realized or accrued after such individuals become bona fide residents of Puerto Rico.

International Financial Entities:  Puerto Rico also enacted legislation in Act 273 of 2012 to create a banking platform for the exportation of financial services from Puerto Rico through the organization of International Financial Entities, which are entities engaged in traditional banking or financial services for non-Puerto Rico clients.

International Insurance Center:  Due to its many advantages, including direct access to the US and other international markets, Puerto Rico is also a sound gateway for insurers and reinsurers wishing to enter the Latin American insurance and financial markets. The international insurers and reinsurers division of the Office of the Insurance Commissioner of Puerto Rico has promoted Puerto Rico as an important member of the international insurance field, and this agenda has become an important part of Puerto Rico’s economic development offering.

In addition to the areas generally described above, Puerto Rico has a favorable business environment that stimulates economic activity with aggressive incentives for many other economic activities:

• 4% fixed income tax rates
• 0-1% income tax rate for pioneer activities
• 100% tax exemption on dividend distributions
• 100% special tax deductions for buildings, machinery and equipment investments
• 90% tax exemption from property and real estate taxes
• 60% tax exemption from municipal license taxes
• 50% tax credit for R&D
• Up to $5,000 per job created
• Training reimbursements up to 50%
• 25% for the purchase of local products
• Infrastructure incentives programs

You may have seen the Puerto Rico Convention Center and its striking architecture, and you wouldn’t be alone for it has hosted over 1.8 million visitors in just 5 years. Or perhaps you have been one of the 3+ million visitors that has enjoyed one of the world-class events that has taken place at Puerto Rico’s award-winning Coliseo de Puerto Rico in the last 6 years. If you haven’t, then you should come and enjoy an evening outing at one of these world-class venues. And while you’re at it, take a look at the rest of an impressive infrastructure system that graces Puerto Rico from shore to shore:

• Extensive highway system with over 4,629 miles and access to mass transit, including an Urban Train system that services over 40,000 daily commuters
• One of the 10 busiest ports in the US – the Port of San Juan is the 8th busiest port in the US
• 11 seaports and trans-shipment seaports with Post-Panamax vessel capabilty
• Best air access in the Caribbean: International/regional airports servicing more than 20 airlines, and San Juan's International Airport is the busiest airport in the Caribbean
• 25 million sq. ft. of industrial space for rent at competitive rates ($2-$6/sq. ft.)
• Pre-qualified foreign trade zones
• Island-wide broadband and fiber opticnetwork capability

EVERYTHING TO SUIT YOUR LIFESTYLE

PUERTO RICO IS A GREAT PLACE TO VISIT OR TO CALL HOME

• Great year-round weather with an average temperature of 83°F in winter and 85 °F in summer
• Over 270 miles of coastline
• Some of the best beaches in the world
• Easily accessible attractions throughout the island

Beaches:  Puerto Rico might be a small island, but it is surrounded by more than 270 miles of beautiful coastline with impressive beaches that are world-renowned. You will be able to sunbathe all day long, or engage in exciting world-class activities such as surfing, fishing, snorkeling or SCUBA diving in miles of reefs that are recognized for the abundance and beauty of their marine life.

Sports:  It doesn’t matter whether you’re into land sports or water sports – we have them all, and all year round. Whether you enjoy being on a bike, on a fishing boat, on a horse or on a golf tee, Puerto Rico offers plenty of options for all of your recreational desires. For instance, if golf is your thing, we have 25 world-class golf courses in Puerto Rico for you to choose from for every level of experience. If surfing's your thing, you'll feel right at home in the surfing capital of the Caribbean.   

Culture:  With a lively mix of Taíno Indian, African, Spanish and American cultural influences, every aspect of your Puerto Rican experience will be permeated by a cultural fusion that will shine through our rich cuisine, our colorful arts and crafts, our vibrant music, and our traditional festivals. You will experience this diversity anywhere you go. Museums feature both European classics and Afro-Caribbean sculpture; buildings blend traditional colonial styles with a bright palette of colors; and our music brings together instruments, rhythms and sounds from eras and places as distant from each other as 18th Century West Africa and medieval Spain. Puerto Rico’s calendar is teeming with mesmerizing cultural events such as the Fiestas de la Calle San Sebastián that mark the end of the Christmas season in January, to the Puerto Rico Heineken JazzFest that brings together international Latin jazz stars during the spring, to the Casals Festival that brings the classical music spotlight to our Caribbean shores. Whatever your tastes may be, you will find it in Puerto Rico.

Cuisine:  Mofongo. Asopao. Lechón. You might not know these words now, but once you come here and taste what they mean, you will remember them forever. If you’re one of those who believe that a culture is best understood through its food, you’re in for the trip of a lifetime. Our island has grown into the gastronomical capital of the Caribbean. World-class chefs man the kitchens at many a restaurant, both locals that have been discovered as well as internationally renowned chefs that have brought their brands to Puerto Rico. Our culinary tradition spans centuries and combines Taíno Indian, Spanish, African and American cultures, recipes and ingredients. From gourmet fine dining to roadside kiosks, you will love exploring our menus and discovering the may tastes of Puerto Rico.

Nightlife:  Puerto Rico may be known for its sunny weather, but there’s also plenty to do when the sun goes down. Depending on your mood, there are many ways to have the night of your life in Puerto Rico. If the spirit moves you to dance, San Juan is teeming with clubs that play everything from live salsa to the best DJs in the Caribbean. If you’re in a mellow mood, you could sit down for cocktails made with the best rum in the world. And if you’re feeling lucky, the casino is always open.

INTRODUCTION TO PUERTO RICO

OUR LOCATION AND GEOGRAPHY

• Flight to Miami is 2.5 hours
• Flight to New York is 4 hours
• Flight to Washington, DC is 4 hours
• Flight to Chicago is 5 hours
• Flight to Dallas is 5 hours
• Flight to Caracas is 1.5 hours
• Flight to Bogotá is 2.5 hours
• Flight to Panamá City is 2.5 hours
• Flight to Santo Domingo is 1 hour
• Flight to Mexico City is 8 hours
• Flight to Madrid is 8 hours

• Manufacturing, Key Supplier and R&D

  •4% corporate tax rate on industrial development income
  •0% to 1% tax rate on income for pioneer products manufactured in PR

  •Up to 50% tax credit on purchases of products manufactured locally

  •Up to $5,000 for each job created during 1st year

• Export Services

  •4% corporate tax rate, which may be reduced to 3%

  •100% tax exemption on dividends from export services businesses

  •Decree of 20 years, renewable for an additional 10 years

• Renewable Energy

  •Rebates of up to 60% for Tier 1 (0-100kW)

  •Rebates of up to 50% for Tier 2 (101kW-1MW)

• International Financial Entities

  •4% corporate tax rate

  •100% exclusion of interest

  •6% dividend tax rate

• Film and Creative Services

  •40% tax credit on all payment to PR residents

  •20% tax credit on all payments to Non-Resident Talent
  •25% tax credit on development costs for media infrastructure

• Tourism and Hospitality

  •90% tax exemption on income and property taxes

  •10% tax credit of total project cost

  •100% tax exemption on excise tax and other taxes

  •100% tax exemption on municipal licenses

TWO NEW ECONOMIC

​DEVELOPMENT TOOLS

Moving to Puerto Rico has never been more attractive. The Caribbean island, which is part of the United States, recently enacted two powerful laws to promote economic development and attract new businesses and residents: the Export Services Act and the Individual Investors Act. These new laws, combined with the island’s beautiful natural resources, proximity to the United States and Latin America, highly skilled bilingual workforce, low operational costs and world-class infrastructure, have made Puerto Rico an ideal place to do business and live.

Export Services Act

Individual Investors Act

Puerto Rico has long been known as an island paradise full of world-class beaches, natural wonders, golf, arts, shopping, dining and nightlife. Its serious side is just getting noticed. In recent years, Puerto Rico has become a premier investment destination, and the passage of these two laws highlights its commitment to new business and enterprise. The time to invest, work, live and play in Puerto Rico is now. Make the comparison. Move to Puerto Rico and bring your business with you!

MODERN AND WORLD-CLASS INFRASTRUCTURE

"...AMONG THE BEST IN LATIN AMERICA AND THE CARIBBEAN"

-- FINANCIAL TIMES

SOLID FOUNDATION FOR ECONOMIC GROWTH

WE ARE PART OF THE US, WHICH MEANS YOUR INVESTMENT IS PROTECTED

Puerto Rico has been a US Territory for over 100 years. This provides Puerto Rico with a political and economic stability that is favorable and that presents a constant and certain business climate for investors that are looking for opportunities that are not attainable anywhere else in the world. Puerto Rico provides all of the opportunities that are available in Latin American countries, but with the protections that can only be assured under the US flag:

• Applicability of the US Constitution and presence of the Federal Court
• Intellectual property protection under US law
• US Currency and banking system regulated by the US (FDIC)
• Under the US customs border jurisdiction
• Participation in the trade agreement of the US
• Access to federal funds for infrastructure, social programs, education and research, among others
• No passport required for US Citizens

FAVORABLE TAX AND COST STRUCTURE

A UNIQUE PROPOSAL FOR MULTINATIONAL CORPORATIONS OR INDIVIDUAL INVESTORS

• No federal income tax for residents of Puerto Rico
• US based multinationals qualify for Controlled Foreign Corporation (CFC) status, where federal income taxes are deferred until profits are repatriated to the US
• Largest non-contiguous Free Trade Zone in the US
• Competitive costs compared to the US
• Average cost of doing business in Puerto Rico is 10% lower than the US average
• San Juan is the least expensive city to do business in among major US cities
• Lowest labor costs of any region in the US
• Educated, skilled, bilingual workforce with over five decades of regulatory compliance expertise and experience