The DMA Way

Completely Compliance- More from Puerto Rico After Hurricane Maria

by DMA Staff | Dec 26, 2017

In the aftermath of Hurricane Maria, the Governor of Puerto Rico issued executive order OE-2017-056 providing an allowance to the Treasury to take precautionary measures with tax collection and the impact on businesses after the loss of power, water and communication.

Following this, in recognition of the importance of small and medium sized businesses (PYMES in the Spanish acronym), the Governor then issued executive order OE-2017-068 allowing for an exemption to PYMES in the collection of sales and use tax on goods and services. The order was issued November 8, 2017. The exemption has certain requirements which must be met and is only temporary for the duration of the state of emergency or December 31, 2017. In order to be eligible to be an exempt merchant, the following criteria must be met: 

  1. Annual sales volume cannot exceed $1,000,000 between August 2016 and July 2017
  2. New businesses registered after July 31st will be considered an exempt merchant
  3. Exempt merchants must be compliant with the Department for all periods prior to July 2017
Note that per Information Bulletin No. 17-21, the filing deadlines for August, September and October tax payment of imports were postponed due to the hurricane to December 11. Similarly the SC 2915 monthly return was also  postponed for the same months and was due December 20. Therefore, these periods, plus November, must be filed timely for eligibility. 

Qualified exempt merchants will be provided a temporary certificate to hang in their place of business and will be  obtainable through the SURI system. In addition to sales tax collection, the certificate will also exempt the business from purchases of inventory for resale but does not apply to other types of consumers use tax.  

Also included in OE-2017-068 was granting approved PYMES a 10% incentive from sales and use tax paid from August to November. Circular Letter No. 17-16 establishes guidelines for PYMES to receive the proper 10% allowed. In addition to the above criteria,  merchants must also have their routing and account number on file with the Department by  December 15. This can be stored in SURI and should  already be established if you pay the SC 2915 by debit. The eligibility and the payment decisions will only be made once, and there will be no appeal process. In addition, any incentive payment will not be made until  after the December 20 return is submitted to SURI. The amount received will be excluded for income tax  purposes. Eligible recipients, should all criteria be met, will receive notification that they are approved for the incentive through SURI by December 22, 2017. 

Completely Compliance is a quarterly e-newsletter exclusively for clients and employees of DMA. It is intended to provide relevant sales/use tax news, events, and information. As such, this e-newsletter should be used for general informational purposes only, and not as a substitute for consultation with professional tax, legal, or other competent advisors. Before making any decision or taking any action based upon information contained in this e-newsletter, you should consult with a DMA professional.