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  • Writer's pictureThe San Juan Daily Star

Inconsistent application of tax exemptions for electric/hybrid vehicle purchases to be investigated



Rep. José Aponte Hernández

By The Star Staff


In response to the allegations made by many consumers who say that when they are prepared to buy an electric vehicle the final price does not reflect the total tax exemption to which they are entitled, at-large Rep. José Aponte Hernández announced on Sunday the filing of an investigation resolution.


“Recently, there has been an increase in statements of confusion and dissatisfaction from consumers, who allege that the effectiveness of measures to encourage the sale of electric vehicles, such as the implementation of the tax exemption, by some dealers has not been clear, transparent or adequate,” the New Progressive Party lawmaker said. “In addition, they point out that the final price of the vehicles does not faithfully reflect the adopted tax reduction.”


“In the face of such statements, and considering the principles of public policy involved, as well as the protection of the interests of the island’s consumers, it is imperative that the House of Representatives initiate an urgent investigation into these allegations,” the former House speaker added.


Last year, 128,531 vehicles were sold in Puerto Rico, of which only about 4,000 were electric or hybrid.


The bill, which will be filed today, directs the House Committee on Consumer Rights, Banking and the Insurance Industry to conduct a thorough investigation into the implementation and enforcement of vehicle excise tax exemptions by auto dealers and relevant government agencies. Hybrid and electric vehicle rebates, along with other rebates, are authorized by Law 81-2014, known as the “Law for the Promotion of Vehicles Powered Mostly by Electricity,” and by Law 1-2011 (Internal Revenue Code for a New Puerto Rico).


Law 81-2014 establishes as public policy the encouragement of the purchase of electric and/or hybrid vehicles as part of the government’s efforts to promote the use of energy from renewable sources.


In its Article 3, the law grants a refund and/or exemption from the payment of excise duties, as applicable, to vehicles powered by alternative or combined energy, as well as to vehicles mainly powered by electricity. This initiative seeks to encourage consumers to purchase this type of vehicle to replace traditional internal combustion vehicles, in line with the adopted public policy.


According to the most recent data provided by the Highways and Transportation Authority and the Department of Transportation and Public Works, it is estimated that between 3,000 and 8,000 electric and/or hybrid vehicles currently travel on Puerto Rico’s roads. The trend coincides with reports from the automotive industry, which project an increase to 10,000 units by the end of 2024.

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