P.R. Laws tit. 23, § 11024c
An eligible business that is a new, expanding, or developing business and has entered into a special job creation agreement shall enjoy the benefits listed below, provided that it meets the requirements of such agreement and this chapter, which have been established generally with respect to a specific incentive:
(a) Property tax exemption.—
(1) Real property tax exemption.— Full real property tax exemption on real property to be used by the eligible business that was unused prior to its acquisition by the eligible business and where the operations thereof shall be established. This exemption shall apply to taxes applicable for the next two (2) fiscal years of the Government following the acquisition date of the property, regardless of the date of acquisition and of the signing of the agreement. The agreement shall specify the property’s cadastral number, as well as the fiscal years to which such exemption shall apply.
(2) The Executive Director shall submit a copy of the agreement to the Municipal Revenues Collection Center. This shall constitute the only transaction necessary for the real property tax exemption to take effect, as applicable.
(b) Partial salary reimbursement.— If an eligible business, in seeking to fully or partially fulfill the incremental job commitment set forth in the agreement, hires persons who were laid off by virtue of Act No. 7-2009, and were unemployed as of December 31, 2012, it shall receive a reimbursement of twenty percent (20%) of the basic wage paid to such persons for a regular work shift (excluding overtime.) Such reimbursement shall apply to wages paid during the first eighteen (18) months of effectiveness of the agreement with respect to eligible employees hired after December 31, 2012, regardless of the date on which the agreement was signed, provided, it is established, to the satisfaction of the Executive Director, that the jobs for which the reimbursement has been granted constitute eligible incremental jobs for the eligible business. Such incentives shall be obtained through the Job Promotion Bureau of the Department of Labor and Human Resources as provided in Act No. 52-1991, as amended. In addition, funds shall also be available for employee training under the Workforce Investment Act of 1998. In the case of a Developing Business, the wage reimbursement percentage set forth in subsections (c) and (d) of § 11024e of this title shall also apply.
(c) Lease of property belonging to the Puerto Rico Industrial Development Company as well as regional warehouses of the Trade and Export Company to establish or relocate its operations and pay one dollar ($1) annually on account of rent during the first two (2) years of the lease.— Developing businesses shall pay one dollar ($1) annually on account of rent during the first three (3) years of the lease. The Puerto Rico Industrial Development Company and the Trade and Export Company shall establish guidelines for leasing their properties, which must be followed by the eligible business in order to execute the leasing contract. The leasing contract shall include the standard terms and conditions for this kind of contract and comply with all the provisions of law, related to leasing, of the Puerto Rico Industrial Development Company and the Trade and Export Company. Once the two (2) year period concludes, the applicable rent shall be the prevailing rental rate at the time the contract was executed with the Puerto Rico Industrial Development Company or the Trade and Export Company, as the case may be. The size and number of eligible properties that the Eligible Business may lease from the Puerto Rico Industrial Development Company or the Trade and Export Company shall depend on factors such as the total number of eligible jobs created, the nature of the eligible business, and the availability of the requested property and the uses and location of the requested space, among others. Such determination shall be at the discretion of the Executive Directors of the Puerto Rico Industrial Development Company or the Trade and Export Company, or by the persons designated by them, as the case may be. However, it shall not be necessary for an eligible business under this chapter to engage in, or consider engaging in, an eligible business within the meaning of the incentives laws to lease this kind of property, provided that such eligible business has executed a special job creation agreement.
(d) Special deduction for expenses incurred in properties leased from the Puerto Rico Industrial Development Company and regional warehouses of the Trade and Export Company.— In addition to any other deduction granted by law, a special deduction equal to the sum of the capital expenses incurred in the construction of improvements, renovations, or repair of the leased eligible property or warehouse, as well as in the acquisition of machinery and equipment to be permanently or temporarily installed in the eligible property or warehouse shall be granted to every eligible business that leases any building of the Puerto Rico Industrial Development Company or warehouse of the Trade and Export Company; provided that such improvements, remodeling, repairs, machinery, or equipment are to be used in connection with the operations of the eligible business, that were agreed upon in the leasing contract. Such improvements, renovations, repairs, machinery, and equipment cannot have been previously used or depreciated.
The amount of the eligible investment for the special deduction provided in this subsection in excess of the net income of the eligible business for the year in which the expense was incurred may be claimed as a deduction in succeeding taxable years until such excess is claimed in full. No deduction shall be allowed under this subsection with regard to the expense or investment portion for which the Eligible Business has received economic incentives from the Puerto Rico Industrial Development Company or any other Government agency, instrumentality or municipality of the Commonwealth of Puerto Rico. This special deduction shall neither apply if the investment has generated other special deductions or tax credits.
(e) A wage subsidy of up to twenty-five percent (25%) for eighteen (18) months as of the effective date of the agreement shall be granted to businesses covered under this chapter for hiring women 40 years of age or older. Funds available under Act No. 52-1991 shall be reallocated for such purposes. The wage reimbursement established in subsection (d) of § 11024e of this title for hiring women 40 years of age or older shall also apply to developing businesses.
(f) Wage reimbursement for hiring certain employees.— Twenty percent (20%) of the Federal minimum wage paid to eligible employees, who are low-income individuals and as of the hiring date are twenty-five (25) years old or younger shall be reimbursed; provided, that it is an eligible incremental job covered under an agreement. The incentive shall be obtained through the Job Promotion Bureau of the Department of Labor and Human Resources as provided under Act No. 52-1991, as amended. In addition, funds shall also be available for employee training under the Workforce Investment Act of 1998.
History —Jan. 10, 2013, No. 1, § 4.4; July 5, 2013, No. 54, § 3.