WASHINGTON — Senate Finance Committee chairman Orrin Hatch and Sen. Marco Rubio introduced a bill on Thursday to provide tax relief to workers in Puerto Rico and improve the commonwealth’s economic outlook.
The Puerto Rico Economic Empowerment Act of 2018 (S. 2873) would implement some of the recommendations made by the Congressional Task Force on Economic Growth in Puerto Rico chaired by Hatch, R-Utah, as well as include provisions left out of recent disaster relief legislation.
“Puerto Ricans have been stuck with a stagnant economy, shaky government finances and — to make matters worse — are still recovering from devastating hurricane damage even as this year’s hurricane season is quickly approaching,” Hatch said. “This legislation builds on the strong bipartisan work of the Congressional Task Force on Economic Growth in Puerto Rico and makes important reforms to promote growth and stability in Puerto Rico.”
“This bill would enact critical tax provisions for Puerto Rico excluded from the recent disaster relief package, like a payroll tax holiday and expanded child tax credit, which would help alleviate the tax burden for Puerto Ricans rebuilding their lives in the aftermath of Hurricane Maria,” said Rubio, R-Fla. “I urge my colleagues to quickly pass it so that we can deliver long- overdue relief to Puerto Rico.”
The bill would provide a payroll tax holiday for two years for employees in Puerto Rico, cutting their payroll taxes in half to 3.1%. The measure also would make Puerto Rican families with one or two children eligible for federal child tax credits. Currently the child tax credits only apply to families with three or more children.
The legislation would help local entrepreneurs in Puerto Rico prosper by making it easier for them to access programs that facilitate lending and development through the Small Business Administration.
In addition, the bill would help better monitor Puerto Rico’s economy by including the territory in many federal statistical surveys as if it were a state, and by establishing a Federal Statistical Research Data Center in the Commonwealth.
The costs of the bill are to be fully offset by redirecting funds from the Prevention and Public Health Fund, established by the Affordable Care Act. The two senators said this measure will has been used to fund other bills.