The Republican tax bill is moved toward final passage today and it contains two provisions that will devastate Puerto Rico a second time following Hurricane Maria.
We've recently discussed the potential side effects and consequences of the hastily-written bill and this appears to be one of them. Or two of them. The bill will impose two new taxes on companies operating in Puerto Rico.
As the U.S. island struggles to climb out of a $70 billion debt crisis and recover from the devastation of Hurricane Maria, House Republicans voted Tuesday to impose a 12.5 percent tax on intellectual property income made by U.S. companies operating on the island and a minimum 10 percent tax on their profits in Puerto Rico. The Senate passed the measure early Wednesday. [...]
The provision, tucked into the GOP’s tax reform bill, was intended to stop American companies from dodging federal taxes by shifting their profits overseas. But because the U.S. tax code treats Puerto Rico as a foreign territory, business operations on the island will get hit.
A significant number of Puerto Ricans have already left the island and migrated to Florida. Florida actually has electricity, fully functioning public services, and food. As residents of Florida, they will also have representation in both chambers of Congress. And if a major storm hits Florida, they won't have to worry (at least not as much) that Trump and the GOP will ignore them.
It seems reasonable to presume the GOP tax bill will contribute to even more migration and, in the long run, that could shift the political balance of power in Florida. I can't necessarily say I hope that will be the case because it comes at a very high cost. It's difficult to see how Puerto Rico will ever recover from Hurricane Trump and the GOP.
Hurricane Maria made landfall on September 20th. Today is December 20th and portions of the island still have no electricity. The island is also drowning in debt and Republicans are going to hit them with new taxes.