DDEC revokes 311 Act 22 decrees, fines 264 Act 20 investors
By The Star Staff
The Economic Development and Commerce Department (DDEC by its Spanish acronym) has revoked 311 decrees established with Act 22 individual investors who failed to send annual reports to the agency.
Economic Development and Commerce Secretary Manuel Cidre Miranda said 264 notifications informing investors of administrative fines of $10,000 each that were sent to Act 20 beneficiaries for failing to file annual reports.
Cidre in a statement reaffirmed his commitment to “zero tolerance” for non-compliance with decree contracts of the Incentives Code (Act 60), granted and monitored by the DDEC’s Incentives Office.
“A year and a half ago we established the control of tax incentives as a priority and we have managed to significantly increase the efforts to control decrees by adding additional personnel and implementing the use of new technologies, and the results are being seen,” he said. “We will continue expanding the magnifying glass, because compliance with these incentives guarantees us the best use of public funds.”
The DDEC chief added that “the tax benefit is tied to a responsibility of the beneficiary, and whoever does not comply with his responsibility will not enjoy the benefit either.”
“You can rest assured that we will continue to monitor them and have zero tolerance for any type of non-compliance,” Cidre said. “What we want is to maximize [the tax benefit’s] performance, looking out for the best interests of Puerto Rico.”
He said the DDEC is continuing to work with the annual report required by Act 60 to measure the return on investment of all incentives, based on what their recipients pay in taxes and contribute to the island treasury. The last report was published in December and the business intelligence team is currently working to publish this year’s report for September.
Carlos Fontán, who directs the DDEC Incentive Office, said the control of concessionaires under the different incentive laws is vitally important.
“We are taking audits very seriously,” he said. “We reiterate that compliance with the terms and conditions of the decrees is essential to maintaining their effectiveness.”
“Accordingly,” Fontán continued, “those entities or individuals that fail to comply with their responsibilities under the applicable incentive laws will be exposed to the penalties established therein, including the retroactive revocation or nullification of the decree, with all the tax and legal consequences that this entails.”