PR Treasury Reports Revenues $76.2 Million Above Estimates

Press Release

Government Development Bank


PUERTO RICO TREASURY REPORTS GENERAL FUND NET REVENUES
TOTALED $1.28 BILLION IN APRIL, $76.2 MILLION ABOVE ESTIMATES

Sales and Use Tax totaled $207.9 million, $87.8 million above April 2015


(San Juan, Puerto Rico) – Treasury Secretary Juan Zaragoza Gómez reported that 
net revenues recorded by the General Fund in April 2016 totaled $1.28 billion, $76.2 
million above revised estimates, and $47.7 million below net revenues in April 2015.

Corporate income taxes were the main revenue driver in April with $409.2 million in 
collections, a year-over-year increase of $32.5 million, or 8.6%, representing 31.9% 
of total revenues for the month, and exceeding revised estimates by $69.7 million. 
A majority of corporate income tax revenues are collected in April, as most corpora-
tions’ returns, as well as the first estimated tax payments for the tax year, are due
in April.

Individual income taxes were another important revenue category with $302 million 
in collections, a $57.4 million year-over-year decrease. One of the reasons for this 
decrease is that collections in April 2015 included $29 million in non-recurring reve-
nues from special laws. April 2016 Sales and Use Tax (“SUT”) revenues totaled 
$207.9 million, $87.8 million above April 2015 receipts. The difference is the result 
of the increase in the state SUT rate to 10.5% from 6% and the 4% tax on designa-
ted business-to-business and professional services (known as B2B).

B2B collections totaled $12.6 million in April. SUT revenues were allocated as foll-
ows: $197.7 million to the General Fund; $9.9 million, or 0.5%, to the Municipal Ad-
ministration Fund; and $270,000 to the Film Industry Fund.

Excise tax categories registered both upward and downward year-over-year chan-
ges. Foreign excise taxes and motor vehicle excise taxes increased by $4.8 million 
and $4 million, respectively,while alcoholic beverages and cigarette excise taxes de-
creased by $1 million and $8.8 million, respectively.

Finally, in April the category known as “Other” registered a $130.8 million decrease. 
This difference is the result of revenues in April 2015 that were non-recurring this 
year. Act 44-2015 allowed the pre-payment of a special tax on certain transactions. 
These transactions included a pre-payment, at a reduced rate of 5%, of taxes on 
corporate dividends for future distributions of accrued benefits and profits. Reven-
ues from prepaid taxes on dividends, which are classified under the category of 
Other, were $111 million in April 2015.

Fiscal year-to-date (July-April) revenues totaled $7.54 billion, a year-over-year incre-
ase of $213.3 million, or 2.9%, $45.7 million above revised estimates, and $238.5
million below estimates included in the original FY 2016 budget. Treasury Secretary 
Zaragoza Gómez noted that based on revenue behavior up to April, estimates inclu-
ded in the revised $9.29 billion budget for FY 2016 are expected to be met.

GDB: JANUARY REVENUES BELOW ESTIMATES

Press Release

Government Development Bank

February 19, 2016


PUERTO RICO TREASURY REPORTS GENERAL FUND NET REVENUES
TOTALED $670.8 MILLION IN JANUARY 2016, $28.7 MILLION BELOW
JANUARY 2015, $59.4 MILLION BELOW REVISED ESTIMATES AND
$162.4 MILLION BELOW ORIGINAL ESTIMATES

Sales and Use Tax collections totaled $247.2 million, a $105.1 million y-o-y
increase (San Juan, Puerto Rico) – Treasury Secretary Juan Zaragoza Gómez,
reported net revenues recorded by the General Fund in January 2016 totaled
$670.8 million, a $28.7 million decrease compared to January 2015. This di-
fference can mainly be attributed to $62.2 million of nonrecurring revenues
from January 2015 that were associated with Act 77-2014, which granted a
temporary period during which certain transactions, such as those involving
Individual Retirement Accounts (IRAs), retirement plans and other capital a-
ssets, could be prepaid at preferential rates. January revenues showed a $162.
4 million reduction compared to original budget estimates. The difference com-
pared to revised estimates is $59.4 million. The categories of individual inco-
me tax, non-resident withholdings and foreign corporations registered the most
significant changes. Individual income taxes registered a $57.1 million year-
over-year decrease. $35.2 million of this reduction can be attributed to non-re-
curring revenues from last year’s tax pre-payment alternatives.

In addition, employers’ withholdings were down by $11 million in January 2016,
causing monthly revenues to be below estimates. In contrast, corporate income
taxes registered an increase of $94.8 million. Revenues from non-resident with-
holdings, a category mainly associated with royalties from the use of manufact-
uring patents, were $102.7 million below January 2015 revenues and $16.4 mi-
llion below revised estimates. This decrease is due, in part, to the fact that a pay-
ment that was received in January last year, is expected to be received in March
this year. This category registers atypical monthly changes because it mainly de-
pends on corporate tax planning.

Foreign excise tax collections showed a $16.9 million decrease compared to revi-
sed estimates. This difference can mainly be attributed to decreased sales reported
by two corporations, one of which reported that it expects to recover part of its sales
in the coming months. January 2016 Sales and Use Tax (SUT) receipts totaled $247.
2 million, approximately $105.1 million above January 2015 receipts. This differen-
ce is the result of the increase in the state SUT rate to 10.5% from 6%, and the 4%
tax on designated business-to-business and professional services (known as B2B).
B2B collections were $11.4 million in January and $26.4 million since its imple-
mentation in October 2015. SUT revenues were allocated as follows: $7.6 million to
COFINA, which completed the remainder of the $696.3 million transfer to COFINA
for this fiscal year; $69.2 million, or 0.5%, to the Municipal Administration Fund;
$1.9 million to the Film Industry Fund; and $168.5 million to the General Fund.

Zaragoza Gómez also reported that fiscal year-to-date (July-January) SUT collec-
tions totaled approximately $1.36 billion, compared to $832.0 million in the same
period of FY 2015, representing a $525.9 million increase. Motor vehicle excise
taxes registered a decrease of less than $1 million. Even though revenues from the
total number of unitswere down, revenues from high-end motor vehicles were up.
Fiscal year-to-date revenues totaled approximately $4.57 billion, a year-over-year
increase of $111.6 million or 2.5%, $59.4 below revised estimates and $183.8 mi-
llion below estimates included in the original $9.8 billion budget for FY 2016.

Puerto Rico News Digest For September 16, 2015

GDB, TREASURY OUT OF MONEY BY YEAR END

From The San Juan Daily Star:

The Puerto Rico Treasury Department’s single cash account and the Go-
vernment Development Bank (GDB) are each expected to exhaust their
liquidity before the end of calendar year 2015. The information was con-
tained in a liquidity update report by Conway-MacKenzie (CM) and in
the island government’s fiscal adjustment plan. Both documents were
made public last week. The Treasury has a treasury single account (TSA)
in which it deposits and disburses amounts related to the General Fund,
certain federal funds, government agencies, general obligation debt issu-
ances (GOs) and payments, net pension benefits, and other items.

PRASA REACHES DEAL WITH US GOVERNMENT

From Caribbean Business:

Under a settlement with the U.S. Department of Justice and the Environ-
mental Protection Agency (EPA), the Puerto Rico Aqueduct and Sewer
Authority (Prasa) has agreed to make major upgrades, improve inspecti-
ons and cleaning of existing facilities within the Puerto Nuevo system and
continue improvements to its systems island-wide, according to the Justice
Department. The Puerto Nuevo sewer system serves the municipalities of
San Juan, Trujillo Alto, and portions of Bayamón, Guaynabo and Carolina.
The settlement updates and expands upon legal settlement agreements rea-
ched with Prasa in 2004, 2006 and 2010.

COCAINE FOUND ON EAST PR COAST

From Caribbean News Now:

US Customs and Border Protection (CBP) Office of Air and Marine Agents
on Friday night recovered 114 pounds (51.7 kilos) of cocaine inside four back-
packs that were ditched by smugglers on the east coast of the island. The esti-
mated value of the seized contraband is $1.4 million.  CBP units near Ceiba,
Puerto Rico found 30 individually wrapped bricks of cocaine inside two pie-
ces of luggage. “Our marine units patrol work with law enforcement partners
to detect and intercept criminal organizations that seek to introduce illegal nar-
cotics,” stated Johnny Morales, director of air operations for CBP’s Caribbean
Air and Marine Branch (CAMB). “This seizure is evidence that our persistence
 is fruitful.”

SALES TAX REVENUE OVER ESTIMATES

From News Is My Business:

Puerto Rico sales and use tax (SUT) revenues collections totaled $190.7 mi-
llion in August, the first month the new 10.5 percent rate was in effect, ex-
ceeding projections by $22.2 million, or 13.2 percent, Treasury Secretary
Juan Zaragoza said Monday. August 2015 estimates took into account the
possible effect of purchases made in advance of the rate increase. Neverthe-
less, the monetary values of the tax base subject to the SUT were very simi-
lar for August 2015 and August 2014, Zaragoza said.