Rep. Méndez Nuñez urges passage of tax reform bill
By The Star Staff
The New Progressive Party minority leader in the House of Representatives, Carlos “Johnny” Méndez Nuñez, asked the Popular Democratic Party (PDP) majority delegation on Wednesday to approve, expeditiously, House Bill (HB) 1645, filed by the administration, which establishes significant tax reductions for the island’s working class.
Méndez Nuñez added that he will be talking with the spokespeople of the PDP, Puerto Rican Independence Party, Dignity Project and Citizen Victory Movement.
“As you know, for the past four years I have worked to achieve a real reduction in the taxes paid by our people and small and midsize enterprises, with the filing of HB 1645 a significant reduction has materialized, particularly in the homes of our working class, which have not received concrete relief since 2011,” he said in a written statement. “I call on the delegations of the Popular Party, both in the House of Representatives and the Senate, to expedite the processing of this bill for the benefit of all taxpayers.”
The former House speaker noted that households with incomes, whether individual or combined, between $41,500 and $61,500, will see a reduction at a rate of 24%, while from households with incomes between $61,500 and $81,500 would also enter the new rate of 24%, thus expanding the base benefiting from the tax decrease.
The measure also retains the 5% and 3% discounts established in laws 257-2018 and 40-2020, respectively, for taxpayers with incomes of $100,000 or less.
“This is the bill that our delegation has requested since 2021 and today it is a reality because we put the house in order,” Méndez Nuñez said. “The measures for control of expenses, the fiscal administration mechanism and the historic boom in economic activity allow converting this bill into law. We achieved $727 million more in revenue per individual taxpayer in 2022 ($3,679 million) than in 2021; that is a clear sign of dizzying progress.”
“In four years (2017-2020) we lowered the tax burden, eliminated the so-called ‘B2B’ (a 2015 tax on transactions between merchants and merchants, as well as professional services), eliminated the national ‘patente’ [business tax]; we sought and approved in the House of Representatives the elimination of the inventory tax, as well as reinstated the bonus for seniors. With this bill (1645) we continue on that path toward reducing the tax burden, leaving more money in the hands of our people to administer.”
Méndez Nuñez has been advocating for “serious” tax reductions for several months in the face of Puerto Rico’s fiscal and economic reality.
According to the projections of the governing administration’s economic team, the application of the proposed reform would result in savings for the individual that exceed $262.5 million.