By John McPhaul
jpmcphaul@gmail.com
Treasury Secretary Francisco Parés Alicea announced on Wednesday the start of the suspension of the excise tax on the introduction and/or manufacture of gasoline and diesel oil (“La Crudita”) in Puerto Rico.
For a period of 45 days, the suspension will be in force for importers and manufacturers of both products in order to bring down gasoline prices on the island.
“As established in Senate Joint Resolution 18-2022 (formerly HR 7-2022), which orders the Department to suspend the collection of taxes on gasoline and diesel oil for 45 days, up to a limit of $25 million, we issued the Internal Revenue Memorandum 22-11 (CC RI 20-11), …” the secretary said in a written statement. “It should be noted that once the exemption has been applied, it must be transferred through the different stages of the distribution chain until it reaches the consumer. For example, if the importer introduces gasoline subject to the exemption during the 45-day period, but distributes it after the period, that importer cannot collect the excise tax on the distribution of the gasoline if it was subject to the exemption in the introduction.”
The temporary suspension of the arbitration must be reflected in the gasoline and diesel stations and personnel of the Department of Consumer Affairs will be vigilant in making sure that it is honored.
Parés Alicea added that the memorandum also establishes the procedure for requesting the reimbursement of excise taxes paid during the exemption period or on the existing and available inventory at the time of validity and the release procedure through the Unified Internal Revenue System, generally referred to as SURI, its Spanish acronym.
The temporary suspension of the tax will also apply to exempt items that importers had in stock and available as of Wednesday. Inventory located in a foreign trade free zone or in a bonded warehouse will not be understood as available until it is withdrawn and duly declared through Form SC 2970 of the Importers Declaration.
For the equitable distribution resulting from the suspension of the tax, the Treasury Department will notify each importer/manufacturer in writing of the maximum amount of exemption that may be claimed. It will be determined according to the introductions and/or average taxable manufactured units, carried out during the year 2021, as recorded in Treasury records.
“If the maximum exemption amount assigned to an importer/manufacturer is met before the 45-day term has elapsed, then said period is over,” Parés Alicea said.