P.R. Laws tit. 23, § 575b
A tax credit shall be granted to investors in an infrastructure project, equal to the lesser amount of the following:
(a) Forty percent (40%) of the amount of the investment in cash paid to the film entity engaged in an infrastructure project, in exchange for primary-issue stock or shares, or
(b) twenty percent (20%) of the budget of the infrastructure project.
(c) If any eligible infrastructure project which generates credit under this section ceases its eligible operations before the expiration of a five (5) year period counted as of the date of the eligible investment was made, the investor shall owe, as income tax, an amount equal to the infrastructure project credit claimed by said investor, multiplied by a fraction whose denominator shall be five (5) and whose numerator shall be the five (5) year period balance required in this subsection. The amount owed on account of income taxes shall be paid in two (2) installments, commencing on the first taxable year following the cessation date of the eligible activity. The Secretary of the Treasury may require as a condition for his/her endorsement to or approval of the credit that the investor posts a bond or any other kind of security in favor of the Secretary of the Treasury in order to respond in the event that the credits are revoked.
(d) No tax credit whatsoever shall be granted for those budget items paid to Puerto Rico residents that are paid in cash or by means of any kind of contribution or appropriation from any department, agency, administration, bureau, board, commission, office, instrumentality, public corporation or municipality of the Commonwealth of Puerto Rico, as well as the Legislative Branch. Thus, any incentive, appropriation, subsidy or any other kind of contribution from these entities, used to pay budget items paid to Puerto Rico residents shall not qualify for the tax credit.
Any investment made with cash proceeding from financing secured by the film entity engaged in an infrastructure project itself or by its assets, shall not be deemed to be an investment in cash.
History —Dec. 24, 1999, No. 362, § 16; Aug. 19, 2009, No. 81, § 3.