The Puerto Rico Treasury reported that September sales and use tax collections were 8.5% above last year's September collections and are expected to be even better in the rest of the fiscal year.
The revenues for September include sales and use tax revenues for many transactions made in August, which was the first month the Treasury began collecting the tax at local air and sea ports.
Puerto Rico has had a significant problem with tax evasion in many of its taxes, including the sales and use tax. Partly in response to this, this summer the Treasury instituted a system to collect the sales taxes on goods' retail price when goods are imported into Puerto Rico. If there is an unusual condition exempting the goods from the tax, domestic retailers are given the opportunity to recover the tax after its initial collection.
The Treasury collected $124.2 million in September in sales and use tax revenue, the highest for September since the sales and use tax was instituted in November 2006. "This figure will be reduced by $4.7 million in automated clearinghouse transactions that were processed but were returned for different reasons, which brings the number down to $119.5 million," the Treasury reported. "The Treasury Department has already identified the nearly 50 merchants whose ACH transactions were returned and will follow up to collect them."
Sales and use tax collections were up 5.4% year-over-year in the first quarter of the fiscal year, which began July 1.
August was the first month that the new port collections process was largely up and running. "As the system is further refined, we expect even greater growth in SUT collections during the coming months," said Secretary of the Treasury Melba Acosta Febo, according to a written statement from the Treasury.
Because of the improved SUT collections, Puerto Rico is further along in collecting the Puerto Rico Sales Tax Financing Corp. (COFINA) contribution through the first quarter than it was through the first quarter of fiscal year 2014. While it had collected 47.4% of this payment by Oct. 1, 2013, it had collected 50.4% of it by Oct. 1 of this year.
Acosta Febo said that she would release a statement about all the government's September revenues later this month.
