Ley 112 del 2001
Resumen
Esta ley enmienda la Ley de Incentivos Contributivos de 1998 para extender el beneficio de la deducción especial por inversiones en edificios, estructuras, maquinaria y equipo a todas las empresas exentas bajo cualquier ley de incentivos contributivos de Puerto Rico, incluyendo aquellas que opten por la exención contributiva flexible.
Contenido
(No. 112)
(Approved August 17, 2001)
AN ACT
To amend subsection
(e) of Section 4 of Act No. 135 of December 2, 1997, known as the "Tax Incentives Act of 1998," in order to extend the benefits of the special deduction for investments in buildings, structures, machinery and equipment to all exempted businesses covered by any tax incentives law of Puerto Rico, and to any exempted business that avails itself in any year, of the flexible tax exemption benefits already provided in the tax incentives laws.
STATEMENT OF MOTIVES
The Tax Incentives Act of 1998 provides for a special deduction for investments in buildings, structures, machinery and equipment. Said provision, found in Section 4(e) of the Act, applies solely and exclusively to exempted businesses under said Tax Incentives Act of 1998, as amended.
In view of the present situation of Puerto Rico regarding its economic development, we believe it would be very helpful for the retention and creation of jobs to approve a measure that offers the opportunity to be able to enjoy the special deduction set forth in Section 4(e) of the Tax Exemption Act of 1998 to every business exempted under preceding laws.
Furthermore, a provision is added to provide this special deduction to any exempted business that avails itself in any year of the benefits of the flexible tax exemption already established in the tax incentive laws, so that the exempted business may use said special deduction, even when that
specific tax year has been selected by the exempted business as not covered by the tax exemption for income tax purposes.
To extend this special deduction to businesses exempted under any preceding tax exemption law allows for greater flexibility and strengthens the cash flow or fiscal situation of these industries, so that they may enjoy their tax benefits to the full extent provided by law. Thus, an additional mechanism is provided to help the exempted businesses to remain competitive in the world markets, and, in turn, also allows them to obtain better tax benefits to achieve their economic goals.
In view of the above, we believe that it is necessary and convenient to extend these tax benefits to any exempted business operating in Puerto Rico, which shall best serve the social and economic interests of the Commonwealth of Puerto Rico.
BE IT ENACTED BY THE LEGISLATURE OF PUERTO RICO:
Section 1. - Subsection
(e) of Section 4 of Act No. 135 of December 2, 1997, as amended, is hereby amended to read as follows: "Section 4. - Special Deductions
(a) . . .
(b) . .
(c) . .
(d) . .
(e) Special Deduction for Investments in Buildings, Structures, Machinery and Equipment.
Any exempted business that holds a decree granted under this Act or under preceding tax exemption laws shall be granted the option of deducting its total expenses incurred after the effective date of
this Act, for the purchase, acquisition or construction of buildings, structures, machinery and equipment, in lieu of any capitalization of expenses required by the 'Puerto Rico Internal Revenue Code,' provided that these buildings, structures, machinery and equipment
(i) have not depreciated or been previously used by any other business or person in Puerto Rico, and (ii) are being used to manufacture the products or render the services for which the benefits provided under this Act were granted. The deduction provided under this subsection shall not be granted in addition to any other deduction provided by law, but shall merely be an acceleration of the deduction of the expenses described above. Provided, that in the case of machinery and equipment previously used outside of Puerto Rico, but that has not previously depreciated or been used in Puerto Rico, the investment in said machinery and equipment shall qualify for the special deduction provided in this subsection
(e) only if as of the date of the acquisition thereof by the exempted business, said machinery and equipment still have at least fifty (50) percent of their useful life, as determined pursuant to the 'Puerto Rico Internal Revenue Code.' The exempted business that holds a decree granted under this Act or under preceding tax incentives laws, may deduct all expenses incurred after the effective date of his Act in remodeling or repairing buildings, structures, machinery and equipment, in the taxable year they are incurred, in lieu of any capitalization of expenses required by the 'Puerto Rico Internal Revenue Code,' whether said buildings, structures, machinery and equipment have been acquired or constructed before or after the effective date of
this Act, and whether they have or have not depreciated or been used by another business or person prior to being acquired by the exempted business that holds a decree granted under this Act or under preceding tax incentives laws. The amount of the investment eligible for the special deduction provided in this subsection, in excess of the net industrial development income of the exempted business that holds a decree granted under this Act or under preceding tax incentive laws in the year of the investment, may be claimed as a deduction in subsequent tax years until said excess is exhausted. No deduction shall be granted under this subsection with regard to the investment in buildings, structures, machinery and equipment, covered by the special deduction provided in subsection
(c) of this Section.
Provided, that the special deduction provided in this subsection, may also be claimed by the exempted business in any year it chooses to select the flexible tax exemption benefit already provided in Section 6(f) of this Act or in Section 3(f) of the Tax Incentives Act of 1987, as amended.
(f) ...'
Section 2.- This Act shall take effect immediately after its approval.
August 5, 2002
Elba Rosa Rodríguez-Fuentes, Esq., Director of the Office of Legislative Services of the Legislature of Puerto Rico, hereby certifies to the Secretary of State that she has duly compared the English and Spanish texts of $\underline{ ext { Act No. } 112}$ (H.B. 777) of the $1^{ ext {st }}$ Session of the $14^{ ext {th }}$ Legislature of Puerto Rico, entitled:
AN ACT to amend subsection
(e) of Section 4 of Act No. 135 of December 2, 1997, known as the "Tax Incentives Act of 1998," in order to extend the benefits of the special deduction for investments in buildings, structures, machinery and equipment to all exempted businesses covered by any tax incentives law of Puerto Rico, and to any exempted business that avails itself in any year, of the flexible tax exemption benefits already provided in the tax incentives laws, and finds the same are complete, true and correct versions of each other.
Elba Rosa Rodríguez-Fuentes