Act 60 - Tourism
Act 60-2019 Section 2051.01 [Ex Act 74]
Effective January 1, 2020, the Puerto Rico Tax Incentives Code (Act 60-2019) consolidates, makes changes to, and eliminates the various legacy Puerto Rico incentives laws, including Acts 20, 22, 73 and 74. Interested parties can no longer apply for tax incentives under the old Acts.
Benefits
4% income tax rate
100% exemption on dividend distribution for PR residents
75% exemption on real and personal property taxes
50% exemption on municipal revenue taxes
100% exemption on sales tax
75% exemption on construction excise taxes
15 year term + 15 year extension
Tax Credit Options:
- 30% of Eligible Investment - 10% taken upon closing of financing, balance taken in three annual installments from opening date.
- 40% of Eligible Investment - taken in three annual installments starting on second year of operation.
- Tax credit may be sold or transferred
Eligible Activities
Hotels
Tourism property with at least fifteen (15) rooms and may include restaurants, pools, casinos, spas, etc.
Condohotels
Units for sale that comply with minimum requirements of a Hotel and are available to guests through a common reservation program.
Puerto Rico Paradores
From 7-75 rooms that are operated under the categories of Hotel, Guesthouse or Villa.
Agro-Hotels
Minimum of three (3) rooms within a property that carries out agro-activities by a Bona-Fide Farmer.
Guest Houses
Minimum of seven (7) rooms with administrative personnel available 24/7. Must have private bathrooms and maid service.
Timeshare
Tourism property where guest purchases a specific unit, structure or villa for a specified time period every year.
Bed & Breakfast Inns
From 3-6 rooms and includes breakfast as part of room rate. Must be operated by a permanent resident on property.
Nautical Tourism
Includes all watercraft with a minimum capacity of six (6) passengers dedicated to charters and other tourism activities.
Medical Tourism
A medical facility authorized by the PR Health Department that serves short term stay visitors.
Leasing
Any business dedicated to leasing to an Exempt Business
Theme Parks
Theme Park Business
Golf Courses
Golf Business
eSports
eSports Business
Fantasy Leagues
Fantasy League Business
Requirements
Pre-Application - Project's Eligible Investment for tax credit purposes will commence on the date of Pre-Application filing with the Tourism Company with the following:
- Description of Project
- Information of Project operator
- Estimated Project costs
- Sources and Uses of Funds
- Job creation estimates
- Opening date estimate
- Pictures of land and buildings
- Construction drawings and location map
- Projected financials
Sworn statement application containing:
- Name, address, telephone and EIN of entity
- Names and SS numbers of all owners
- Contact info of representative
- Description of Eligible Business
Cert. of Incorporation
Financial Statements
Negative Debt Certificates from Hacienda, CRIM, Dept. of Labor, State Insurance Fund, and Tourism Company.
Construction Permit and Plans
Use Permit and other compliance
Certificate of Insurance Coverage
Real and Personal Property Inventory
Job creation estimates
Total investment detail
Sources and Uses of Funds
Estimated opening date
Property Safety Plan, Handicapped Facilities, Conservation Plan, and Personnel Training Plan.