In November Puerto Rico General Fund revenues came in 0.7% short of budget, while the commonwealth's sales and use taxes came in 9.5% above November 2013.
The sales and use taxes are diverted to the Puerto Rico Sales Tax Finance Corporation (COFINA) in the early months of the fiscal year. The government expects some of the sales and use tax revenues to go to the General Fund starting in December.
The General Fund net revenue collection of $452 million was due to some categories coming in above projections while others came in below. Individual income taxes were $20 million above projections and the "others" category was $11.2 million above projection.
The unexpected strength of income taxes was due to an act that allowed the prepayment of certain income taxes, according to a statement from the Puerto Rico Treasury. This act is scheduled to expire Dec. 31 but Gov. Alejandro García Padilla is exploring extending it.
The foreign corporation excise tax (Act 154) came in $16 million less than projected. One of the reasons for this was that one corporation had unexpectedly moved its production to earlier months.
Motor vehicles excise revenues came in $8.3 million less than projected. This was because the governor reduced the motor vehicle excise tax in November to help spur auto sales.
The commonwealth government is diligently working on a major tax reform which is expected to be unveiled in the next few weeks. The cut in the motor vehicle excise tax "launched some changes contemplated in the first stage of the tax reform," the Treasury said.
Through the first five months of the current fiscal year, Puerto Rico's General Fund net revenues have come in 1.2% below the budget expectation.
On a brighter note, sales and use taxes have been coming in strong. Through the first five months of the fiscal year these taxes are 6.9% ahead of their level in the first five months of last fiscal year. If these taxes continue at a strong pace, they will help General Fund revenue collections in the rest of the fiscal year.
