Tax & Accounting Blog

We will miss you SUT! Love, Puerto Rico

Blog, Indirect Tax, ONESOURCE, Sales and Use Tax March 28, 2016

Besides the relative simplicity of the current sales and use taxation system you will also miss the exemption on funeral services contained in section 4030.16 of the 2011 Puerto Rico Internal Revenue Code, as amended. The new VAT system desecrates the partial exemption you are now entitled to of up to $4,000 for services rendered by a funeral home for the wake and final disposition of your loved ones. Services include “registration of death certificate, obtaining burial permits, embalming, use of facilities or personnel, recovery or transfer of the body, use of hearse and flower car, preparation of the body, treatment for transfer overseas, cremation” the casket and the purchase of a cemetery plot.

If this does not bring tears to your eyes, wait until you start to prepare for the new school year under the VAT system. That is because the two yearly back-to-school sales tax holidays contained in section 4030.20 of the 2011 Puerto Rico Internal Revenue Code, as amended, are gone with the SUT. Gone are the July and January 3-day periods in which the sale of certain apparel and school supply items, including uniforms will be exempt from taxation. So, with much sadness we will be waving goodbye to the SUT.

Written by Isabel Garcés.