Act 60: Puerto Rico Tax Incentives

Puerto Rico's unique structure makes it a part of the US system but gives it autonomy over its own financial affairs. This allows it to grant unique incentives for investors.

All acts and incentives were combined into one act, Act 60, in July 2019. Act 60 has a number of chapters of incentives covering various aspects of the  economy, as well as sections on tax credits.

This is not intended as legal or tax advice. We are not accountants or lawyers. We do our best to give you enough information to get started and recommend you check everything with licensed professionals. If you are aware of any errors on the site, please let us know.

Chapter 3: Incentives for Export Goods and Services

SUBCHAPTER A – ELIGIBILITY

Section 2031.01.- Export of Services.

(a) Eligible Activities.- Any Person with an office or bona fide establishment located in Puerto Rico which carries out or may carry out the following service activities, inside or outside Puerto Rico, that are, in turn, considered Services for Export or Promoter Services shall be considered an Eligible Business for the benefits of this Section:

(1)  Research and development;

(2)  Advertising and public relations;

(3)  Economic, environmental, technological, scientific, managerial, marketing, human resources, computer, and auditing consulting services;

(4)  Consultancy for issues related to any trade or business;

(5)  Creative Industries as defined in Section 1020.09 of this Code, including the sale of tickets outside of Puerto Rico, or the sale of tickets bought by tourists in Puerto Rico as well as income related to the broadcasting or the sale of copyrights for a recording intended for audiences outside of Puerto Rico, of shows and music productions, and eSports and Fantasy Leagues events to be brought to Puerto Rico;

(6) Drafting of construction plans and engineering, architectural, and project management services;

(7)  Professional services such as legal, tax, and accounting services;

(8)  Centralized management services including, but not limited to, strategic direction, planning, distribution, logistics, and budgetary services rendered in the headquarters or similar regional offices by an Entity engaged in the rendering of such services. Furthermore, strategic and organizational planning services, distribution services, and logistics services rendered to persons outside of Puerto Rico shall also be eligible;

(9) Electronic data processing centers;

(10)  Computer software development;

(11)  Distribution, whether it is physical, online, through the cloud, or related to blockchain technology, and the income earned from the licensing, program subscriptions, or services fees;

(12) Voice, video, audio, and data telecommunications between persons located outside Puerto Rico;

(13)  Call centers;

(14)  Shared service centers including, but not limited to, accounting, finance, tax, auditing, marketing, engineering, quality control, human resources, communications, electronic data processing, and other centralized management services;

(15)  Educational and training services;

(16)  Hospital and laboratory services including Medical Tourism and telemedicine sites;

(17) Investment banking and other financial services including, but not limited to: (a) Asset management services; (b) alternative investment management; (c) management of activities related to private equity management; (d) management of hedge funds or high risk funds; (e) management of pools of capital; (f) management of trusts that serve to turn different types of assets into stocks, and (g) management services for escrow accounts, insofar as these services are provided by foreign persons;

(18) Marketing centers engaged primarily in providing, through leasing, service, or other type of fees, space and services such as: secretarial, translation, and data processing services, communications, marketing, telemarketing, and other consulting services to businesses outside of Puerto Rico, including export and marketing companies, commercial attachés, government agencies responsible for foreign trade, exchange, and product and service exhibition centers; and/or

(19) Any other service that the Secretary of the DEDC, in consultation with the Secretary of the Treasury, determines that shall be treated as an eligible service because it is deemed to be in the best interest and for the social and economic wellbeing of Puerto Rico, taking into account the demand that there may be for such services outside Puerto Rico, the total number of jobs to be created, its payroll, the investment that the sponsor would make in Puerto Rico, or any other factor that warrants special consideration.

(b) A service shall be deemed to be a Service for Export when such service is rendered to benefit the following:

(1) A Foreign Person, provided that the services do not have a Connection to Puerto Rico.

(2) A trust whose beneficiaries, trustors, and trustees are not Resident Individuals of Puerto Rico, provided that the services do not have a connection to Puerto Rico.

(3) An estate whose decedent, heirs, legatees, or executors are not Resident Individuals of Puerto Rico, or in the case of the decedent, had been a Resident Individual of Puerto Rico, provided that the services do not have a Connection to Puerto Rico.

(4) A Person engaged in business in Puerto Rico, provided that the services do not have a Connection to Puerto Rico, and the services are intended for a client of said Person that complies with any of the provisions listed in this subsection.

(5) Any other criteria, requirement, or condition for a service to be deemed to be a service for export may be prescribed in the Incentives Regulations, an administrative order, a circular letter, or any other general communication, taking into account the nature of the services rendered, the direct or indirect beneficiaries, and any other pertinent factor to achieve the objectives of this chapter.

(c) Services, including Services for Export, shall be deemed to have a Connection to Puerto Rico when they are somehow related to Puerto Rico, including services associated with the following:

(1) Business or profitable activities which have been or shall be carried out in Puerto Rico;

(2) Advice on the laws and regulations of Puerto Rico, procedures and administrative orders of the Government of Puerto Rico, its agencies, public corporations, instrumentalities, or municipalities, as well as the precedents of the Courts of Puerto Rico;

(3) Lobbying with respect to the laws of Puerto Rico, regulations, and other administrative orders. For these purposes, lobbying shall mean any direct or indirect contact with elected officials, employees, or agents of the Government of Puerto Rico, its agencies, instrumentalities, public corporations, or municipalities with the intent of influencing any action or determination of the Government of Puerto Rico, its agencies, instrumentalities, public corporations, or municipalities;

(4) The sale of any property for use, consumption, or disposition in Puerto Rico; or

(5) Any other activity, situation, or circumstance related to Puerto Rico that is prescribed in the Incentives Regulations or other determination, administrative decision, or circular letter.

(d) The Secretary of the DEDC may include in the Incentives Regulations any other criterion, requirement, or condition for a service to be considered a Service for Export, taking into consideration the nature of the services rendered, the direct or indirect benefits of such services, and any other pertinent factor to achieve the objectives of this Code.

(e) Promoter services may be treated as Services for Export regardless of whether these services have a Connection to Puerto Rico.

(f) An Eligible Business that renders Services for Export or Promoter Services may also engage in any other activity, trade, or business insofar as it keeps, at all times, a system of books, records, documentation, accounting, and billing that clearly shows, to the satisfaction of the Secretary of the Treasury, all income, costs, and expenses incurred while rendering Services for Export or Promoter Services. An activity consisting of rendering services as an employee does not qualify as an Eligible Business.

(g) The provisions of any other law notwithstanding, licensing requirements related to professional services shall not apply to Eligible Businesses, their partners, shareholders, employees, or officials, insofar as the services offered are not rendered to Domestic Persons. Eligible Businesses shall comply with the licensing laws and requirements applicable in the jurisdiction where their services are exported.

(h) The Secretary of the DEDC shall prescribe in the Incentives Regulations, the circumstances and conditions under which a business may be designated as an Eligible Business. For purposes of this Chapter, any applicant who receives or has received tax benefits or incentives under Act No. 20-2012, as amended, Act No. 73-2008, as amended, Act No. 135-1997, as amended, Act No. 8 of January, 24, 1987, as amended, any previous or subsequent tax incentives law, or any other special law of the Government of Puerto Rico that provides benefits or incentives similar to those provided in this Chapter, as determined by the Secretary of the DEDC in consultation with the Secretary of the Treasury, shall be deemed to be an Eligible Business.

Section 2031.02.- Export Trade.

(a) Eligible Activities.- It shall be deemed to be an Eligible Business for purposes of the benefits provided under this Section, any Person with an office or bona fide establishment located in Puerto Rico who engages or may engage in business as a trading company that derives not less than eighty percent (80%) of its gross income from:

(1) The sale to Foreign Persons, for use, consumption, or disposition outside of Puerto Rico, of products purchased by the Eligible Business for resale;

(2) Commissions derived from the sale of products for use, consumption, or disposition outside of Puerto Rico; provided, however, that no part of the income derived from the sale or resale of products for use, consumption, or disposition in Puerto Rico shall be deemed to be Export Trade Income;

(3) The sale of products manufactured or harvested upon request, to Foreign Persons, for use, consumption, or disposition outside of Puerto Rico;

(4) The sale or distribution to Persons outside of Puerto Rico of intangible products, such as patents, copyrights, digital content, and trademarks, among others;

(5) Storage, transportation, and distribution hubs for products and articles belonging to third parties;

(6) The commercial distribution of products manufactured or harvested in Puerto Rico for jurisdictions outside of Puerto Rico;

(7) The assembly, bottling, and packaging operations of products for export;

(8) Any other international trading activity to be included in the Incentives Regulations, taking into consideration the nature of the activities carried out, the direct or indirect benefits of the commercial activity for Puerto Rico, and any other factor pertinent to achieve the objectives of this Code, when such treatment is deemed to be in the best interest and for the social and economic wellbeing of Puerto Rico.

(b) An eligible activity may be deemed to be an Export Trade activity, provided that it has no Connection to Puerto Rico.

(c) Export Trade activities shall be deemed as having a Connection to Puerto Rico when they are somehow related to Puerto Rico, including activities associated with the following:

(1) the sale of any property for use, consumption, or disposition in Puerto Rico; or

(2) any other activity, situation, or circumstances that the Secretary of the DEDC prescribes in the Incentives Regulations or other determination, administrative decision, or circular letter as having a connection to Puerto Rico.

(d) The Secretary of the DEDC shall prescribe in the Incentives Regulations, the circumstances and conditions under which a business may be designated as an Eligible Business. For purposes of this Section, any applicant who receives or has received tax benefits or incentives for the export of goods or services similar to those provided in this Section under Incentives Laws Previous or subsequent to Act No. 20-2012, as amended, Act No. 73-2008, as amended, Act No. 135-1997, as amended, Act No. 8 of January, 24, 1987, as amended, or any other special law of the Government of Puerto Rico, as determined by the Secretary of the DEDC, shall be deemed to be an Eligible Business.

SUBCHAPTER B – TAX BENEFITS

Section 2032.01.- Tax on Income from Export of Services and Promoter Services.

(a) General Rule- The net income derived from Export of Services or Promoter Services, as provided in subsection (a) of Section 2031.01 of this Code, shall be subject to a flat preferential income tax rate of four percent (4%) in lieu of any other income tax, if any, provided by the Puerto Rico Internal Revenue Code or any other law.

(b) Special Rules for Promoter Services.- The Eligible Business shall report the income, expenses, deductions, and concessions of Promoter Services in the Taxable Year in which said items are recognized in the Internal Revenue Code. However, the Secretary of the DEDC, in consultation with the Secretary of the Treasury, may allow in the Incentives Regulations a method to recognize said items when the conditions that shall apply to an Entity that is Affiliated, as such term is defined in Section 1020.01 of this Code, are met after the Taxable Year in which the income would be otherwise recognized in the Internal Revenue Code.

(c) Limitation of Benefits.- If on the filing date of the application for a Decree, pursuant to the provisions of this Code, an Exempt Business was engaged in the Export of Services or Promoter Services for which the benefits of this Chapter are granted, or was engaged in such activity at any time during the three (3) Taxable Years prior to the date on which the application was filed, called the “base period,” the Exempt Business may enjoy the flat income tax rate provided in subsection (a) of this Section, only with regards to the increase in the net income which said activity generates over the average net income of the “base period” which shall be denominated “base period income,” for purposes of this Subchapter.

(1) The net income of any business that preceded the applicant business shall be taken into account in order to determine base period income. For such purposes, “predecessor business” shall include any operation, activity, trade, or business carried out by another business and which was transferred or otherwise acquired by the applicant business, without taking into account whether it was operating under another legal name or owner.

(2) The base period income shall be subject to the income tax rates provided in the Puerto Rico Internal Revenue Code. In the case of Entities with tax exemption Decrees for Services for Export activities pursuant to Act No.73-2008, Act No. 135-1997, and Act No. 8 of January 24, 1987, the flat rate established in the Decree for the base period income shall apply, and the distribution of the earnings or profits stemming from such income shall not qualify for the treatment provided in Chapter.

(3) The base period income shall be adjusted reducing such amount by twenty-five percent (25%) annually, until reduced to zero (0) for the fourth Taxable Year to which the terms of the Decree of the Exempt Business apply, as provided in this Chapter.

(d) Distributions from earnings or profits.

(1) General Rule.- The shareholders, partners, or members of an Eligible Business holding a Decree granted under this Chapter shall not be subject to income tax on distributions of dividends from earnings or profits arising from Income from Export of Services of the Eligible Business. Subsequent distributions from Income from the Export of Services made by any corporation or Entity filing as a corporation or any partnership shall also be exempt from all taxes.

(2) Distributions described in paragraph (1) above shall also be excluded from:

(i) The net income subject to the alternate basic tax of an individual for purposes of the Puerto Rico Internal Revenue Code;

(ii) The alternative minimum net income of a corporation for purposes of the Puerto Rico Internal Revenue Code;

(iii) The adjusted net income according to the books of a corporation for purposes of the Puerto Rico Internal Revenue Code.

(e) Imposition of Exempt Distributions.- Distributions of dividends or benefits made by an Exempt Business pursuant to the provisions of this Chapter, even after said Decree has expired, shall be deemed to be made from Income from the Export of Services if, at the time of the distribution, it does not exceed the undistributed balance of earnings and profits accrued and arising from income derived from the Export of Services, unless said Business, at the time of the statement, chooses to distribute, totally or partially, the dividend or benefit of other earnings or profits. The amount, year of accrual, and nature of the distribution made from the earnings or profits arising from income from the Export of Services shall be that which is designated by said Business, through a notice sent, together with the payment, to its shareholders, members, or partners and to the Secretary of the Treasury, in an information statement, in the form established in the Puerto Rico Internal Revenue Code.

(1) In the case of Entities that on the date of the commencement of operations as Exempt Businesses have earnings or profits accrued, the distribution of dividends or benefits made as of that date shall be deemed to have been made from the undistributed balance of such earnings or profits, but once such balance is exhausted by such distributions, the provisions of this subsection shall apply.

(f) Deduction and net operating loss carryover.—

(1) Deduction for ongoing loss incurred in activities not covered by a Decree.- If an Eligible Business holding a Decree granted under this Chapter incurs net operating losses not attributable to Export of Services or Promoter Services covered by the Decree, said losses shall not be used against income from operations covered by a Decree under this Section and shall be governed by the provisions of the Puerto Rico Internal Revenue Code.

(2) Deduction for ongoing loss incurred in the operation of the Eligible Business.- If an Eligible Business holding a Decree granted under this Chapter incurs net operating losses attributable to Export of Services or Promoter Services, said losses shall only be used against other income from operations attributable to such services covered by the Decree.

(3) Deduction for loss carried over from previous years.- A deduction for loss incurred in previous years shall be granted as provided below:

(i) The excess over losses deductible under paragraph (2) of this subsection shall be carried over against the Income from Export of Services of subsequent taxable years. The losses shall be carried over in the order in which they were incurred.

(ii) Once the term of the Decree has expired for purposes of the income tax, net losses incurred in the operation covered by the Decree, as well as any excess of the deduction allowed under paragraph (2) of this subsection that the Eligible Business is carrying over as of the date of expiration of said term, may be deducted against any taxable income in Puerto Rico, subject to the limitations provided in the Puerto Rico Internal Revenue Code. Said losses shall be deemed as incurred in the last Taxable Year in which the Eligible Business holding a Decree pursuant to this Section enjoyed the tax rate described in subsection (a) of this Section, in accordance with the terms of the Decree.

(iii) The amount of net operating loss incurred in the Taxable Year and carried over in subsequent years shall be computed pursuant to the provisions of the Puerto Rico Internal Revenue Code.

Section 2032.02.- Tax on Income from Export Trade Activities.

(a) General Rule.- The net income from Export Trade activities, as provided in paragraph (1), subsection (a) of Section 2031.02 of this Code, shall be subject to a flat preferential income tax rate of four percent (4%), in lieu of any other income tax, if any, provided in the Puerto Rico Internal Revenue Code or any other law.

(b) Limitation of benefits.-

(1) If on the filing date of the Decree application, pursuant to the provisions of this Code, an Eligible Business was engaged in Export Trade, pursuant to paragraph (1), subsection (a) of Section 2031.02 of this Code, or was engaged in such activity at any time during the three (3) Taxable Years preceding the date on which the application was filed, called the “Export Trade Base Period,” the Eligible Business may enjoy the flat income tax rate provided in this Section, only with regards to the increase in the net income which said activity generates over the average net income of the Base Period which shall be denominated “Export Trade Base Period Income,” for purposes of this subsection.

(2) The net income of any Predecessor Business shall be taken into account to determine the Export Trade Base Period Income. For such purpose, “Predecessor Business” shall include any operation, activity, trade, or business carried out by another business and which was transferred or otherwise acquired by the applicant business, without taking into consideration if it was operating under another legal name or owner.

(3) The income attributable to the Export Trade Base Period Income shall be subject to the income tax rates provided in the Puerto Rico Internal Revenue Code, and the distribution of the earnings and profits stemming from such income shall not qualify for the treatment provided in subsection (c) of this Section.

(4) The Export Trade Base Period Income shall be adjusted reducing such amount by twenty-five percent (25%) annually, until reduced to zero (0) for the fourth taxable year to which the terms of the Decree of the exempt business under this Code apply.

(c) Distributions of earnings and profits.

(1) General Rule: The shareholders, partners, or members of an Exempt Business holding a Decree granted under this Chapter shall not be subject to income tax on distributions of dividends from earnings and profits arising from the Export Trade Income of the Exempt Business. Subsequent distributions from Export Trade Income made by any corporation or Entity filing as a corporation or any partnership shall also be exempt from all taxes.

(2) Distributions described in this subsection shall also be excluded from:

(i) The net income subject to the alternate basic tax of an individual for purposes of the Puerto Rico Internal Revenue Code;

(ii) The alternative minimum net income of a corporation for purposes of the Puerto Rico Internal Revenue Code; and

(iii) The adjusted net income according to the books of a corporation for purposes of the Puerto Rico Internal Revenue Code.

(d) Imposition of exempt distributions.- Distributions of dividends or benefits made by an Exempt Business holding a Decree granted under this Chapter, even after said Decree has expired, shall be deemed made from Income from Export Trade if, on the date of the distribution, it does not exceed the undistributed balance of earnings and profits accrued and arising from Income from Export Trade, unless said Exempt Business, at the time of the statement, chooses to distribute, totally or partially, the dividend or benefit of other earnings or profits. The amount, year of accrual, and nature of the distribution made from the earnings and profits arising from Income from Export Trade shall be that which is designated by said Exempt Business, through a notice sent, together with the payment, to its shareholders, members, or partners and to the Secretary of the Treasury, in an information statement, in the form established in the Puerto Rico Internal Revenue Code.

(e) In the case of Entities that, on the date of the commencement of operations as Exempt Businesses, have earnings or profits accrued, the distribution of dividends or benefits made as of that date shall be deemed to have been made from the undistributed balance of such earnings or profits, but once such balance is exhausted by such distributions, the provisions of this subsection shall apply.

(f) Deduction and net operating loss carryover.-

(1) Deduction for ongoing loss incurred in activities not covered by a Decree.- If an Exempt Business holding a Decree granted under this chapter incurs net operating losses not attributable to the operation covered by the Decree, such losses shall not be used against income from operations covered by a Decree in accordance with this Chapter, and shall be governed by the provisions of the Puerto Rico Internal Revenue Code.

(2) Deduction for ongoing loss incurred in the operation of the Eligible Business.- If an Eligible Business holding a Decree granted under this Section incurs net operating losses covered by the Decree, such losses shall only be used against other income from operations covered by the Decree pursuant to this Section.

(3) Deduction for loss carried over from previous years.- A deduction for loss carried over from previous years shall be granted as provided below:

(i) The excess over losses deductible under paragraph (2) of this subsection shall be carried over against Income from Export Trade of subsequent taxable years. The losses shall be carried over in the order in which they were incurred.

(ii) Once the term of the Decree has expired for purposes of the income tax, net losses incurred in the operation covered by the Decree, as well as any excess of the deduction allowed under paragraph (2) of this subsection that the Exempt Business is carrying over as of the expiration date of said term, may be deducted against any taxable income in Puerto Rico, subject to the limitations provided in the Puerto Rico Internal Revenue Code. Said losses shall be deemed as incurred in the last Taxable Year in which the Exempt Business holding a Decree granted under this Chapter enjoyed the tax rate described in subsection (a) of this Section, in accordance with the terms of the Decree.

(iii) The amount of net operating loss incurred in the Taxable Year and carried over in subsequent years shall be computed pursuant to the provisions of the Puerto Rico Internal Revenue Code.

Section 2032.03.- Property Tax

(a) General Rule.- The personal and real property of an Exempt Business used in Export of Services, Promoter Services, or Export Trade covered by a Decree granted under this Chapter shall enjoy a seventy-five percent (75%) exemption from municipal and state property taxes during the fifteen (15)-year exemption period.

Section 2032.04.- Municipal Taxes.

(a) General Rule.- An Exempt Business shall enjoy a fifty percent (50%) exemption from the municipal licenses or taxes applicable to the volume of business thereof during the fifteen (15)-year exemption period related to the Export of Services, Promoter Services, or Export Trade covered by a Decree granted under this Chapter.

SUBCHAPTER C – REQUIREMENTS FOR GRANTING EXEMPTIONS

Section 2033.01.- Requirements for Decree Applications.

(a) Any Person with a bona fide office or establishment located in Puerto Rico who has established or intends to establish an Eligible Business in Puerto Rico under this Chapter may apply for the benefits of this Chapter by filing the appropriate Decree application with the Secretary of the DEDC as provided in Subtitle F of this Code.

(b) Such Person may apply for the benefits of this Chapter provided that the eligibility requirements of Subchapter A of this Chapter are met as well as any other criteria prescribed by the Secretary of the DEDC in the Incentives Regulations, an administrative order, circular letter, or any other general communication, including, as an evaluation criteria, the Eligible Business’ contribution to the economic development of Puerto Rico.

SUBCHAPTER D – SPECIAL PROVISIONS

Section 2034.01.- Qualified Promoter

(a) A Qualified Promoter is that which provides Promotion Services to a New Business in Puerto Rico that is granted a Decree and meets the following requirements:

(1) A Qualified Promoter shall be the owner, shareholder, member, or Full Time employee of an Entity holding a Promotion Service Decree and may make efforts to establish New Businesses in Puerto Rico pursuant to the incentive provided for in this Chapter.

(2) To be designated as Qualified Promoter, the Promoter shall file with the Secretary of the DEDC a sworn application showing that the requirements provided in this Section are met. The Secretary of the DEDC shall evaluate said application within a period of thirty (30) days from the filing thereof, except for just cause. If the Secretary of the DEDC determines that the Promoter meets the criteria established and has paid the appropriate fees, the Secretary of the DEDC shall notify the Promoter. The Secretary of the DEDC shall keep an electronic register of Qualified Promoters, which shall be public and accessible through the Portal.

(3) The Secretary of the DEDC, in conjunction with Invest Puerto Rico Inc., shall prescribe the requirements to become a Qualified Promoter in the Incentives Regulations. Qualified Promoters shall meet, at least, the following requirements:

(i)  To hold a bachelor’s degree from an accredited university;

(ii)  To have at least five (5) years of professional experience in their area of competence (i.e., accounting, finance, marketing, planning, international trade, Law, economics, science, engineering, real estate, or other similar fields);

(iii) To show ability to understand and express themselves properly on matters related to the establishment of businesses in Puerto Rico;

(iv) To submit a criminal record certificate showing that no felonies or misdemeanors against the moral and public order were committed.

(4) The Qualified Promoter shall not be granted the benefits of this Chapter for the promotion of a New Business in which the Qualified Promoter has a share as partner or member thereof.

(5) The Qualified Promoter shall not be granted the benefits of this Chapter for the promotion of a New Business where his spouse, parents, or children hold management positions or positions with decision-making power, including as members of a Board of Directors or shareholders with voting power.

(6) The Qualified Promoter shall not issue any payment whether directly or indirectly related to the incentives received, to any of the following persons:

(i) A New Business in Puerto Rico, or its Affiliates, in accordance with the provision of the Puerto Rico Internal Revenue Code.

(ii) Any officer, director, or employee of such New Business in Puerto Rico, or its Entities that are Affiliates.

(iii) Any related party to said officer, director, or employee, as defined in Section 1010.05 of the Puerto Rico Internal Revenue Code.

(7) Qualified Promoters shall not be prohibited from acting as a service provider that has appeared before the DEDC or any of its attached agencies, as representative of a Decree applicant in accordance with this Code, and that generates income from a New Business in Puerto Rico for such or other services, before or after its establishment in Puerto Rico. The Qualified Promoter, however, may not serve, or have served, as a Certified Professional for the New Business in Puerto Rico, or participate in the process of preparing financial statements or income tax returns, or in the issuance of annual reports of the New Business in Puerto Rico.

(8) The total incentive available to the Qualified Promoter is of up to fifty percent (50%) of the amount deposited in the Economic Incentives Fund and is transferred to Invest Puerto Rico Inc. on account of income taxes paid to the Secretary of the Treasury by the New Business in Puerto Rico. The incentive shall be paid for a maximum of ten (10) taxable years from the date of establishment of the New Business in Puerto Rico.

(9) Invest Puerto Rico Inc. shall disburse the incentive through a service agreement by and between the Qualified Promoter and Invest Puerto Rico Inc. within a period that shall not exceed thirty (30) days from the receipt of the funds of the Economic Incentives Fund.

(10) Invest Puerto Rico Inc. may distribute the incentive in different stages and to various Qualified Promoters that have participated in the promotion process of the New Business in Puerto Rico in accordance with the provisions of the Incentives Regulations.

(11) The income earned by the Qualified Promoter on account of the incentive established in this Chapter shall be subject to the regular income tax rate, in accordance with the provisions of the Puerto Rico Internal Revenue Code.

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