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Hamilton Creator, Puerto Rican Officials Lobby Against "Crippling" Import Tax In GOP Reform Bill

by Countable | 12.14.17

What’s the story?

The GOP tax reform is massive, with many provisions that have flown largely under the radar. One imposes a 20 percent tax on manufacturing imports from Puerto Rico. Puerto Rican officials were told by GOP leadership it would be removed before final passage, but it's still in there.

Lin-Manuel Miranda, creator of Hamilton, published an op-ed in the Washington Post Thursday begging Congress to remove the provision before final passage, expected next week.

The provision is also worrying manufacturers in Puerto Rico, who fear it will harm the island's recovery from recent hurricanes. According to NPR, medical manufacturing companies are working to get back up to speed on production -- but with continued power outages and storm damage to contend with, they're worried about their futures on the island.

Why does it matter?

Though there are still tax advantages for companies that manufacture goods in Puerto Rico, some of the significant tax breaks that caused manufacturers to flock to the island starting in the 1950’s were phased out starting in the 1990’s.

That phase out caused many companies who had set up shop in Puerto Rico to flee the island, drastically changing the Puerto Rican economy and helping set the stage for the debt crisis the territory faces today.

Critics of the island’s corporate tax break system, however, argue the effort never promoted a sustainable, local economy.

Despite the phase out that ended in 2006, there are still companies based on the island. Half of the island's economy is fueled by manufacturing. The situation for some is dire, though, in the wake of Hurricane Irma and then Maria. Power outages are still widespread, phone and internet service are spotty, and immigration to the mainland is shrinking the skilled workforce.

Companies are stepping up to provide meals, daycare and other services to help employees and are frustrated with the pace of recovery.

Governor Ricardo Rosselló and Rep. Jenniffer González are lobbying on behalf of the island to prevent inclusion of the 20 percent tax on all goods manufactured and sold to the mainland in the tax reform bill. If the tax is imposed, some fear manufacturers on the island may not be able to compete with manufacturers on the mainland and will be forced to leave.

González says she has been assured by Republican leadership that the measure will be removed from the tax reform bill before final passage, but as a non-voting delegate she has little leverage to ensure that happens.

What do you think?

Should an import tax on goods manufactured in Puerto Rico be included in the tax reform bill? Why or why not?

Tell us in the comments what you think, then use the Take Action button to tell your reps!

— Asha Sanaker

(Photo Credit: Wikimedia / Creative Commons)

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(46)
  • Sean
    11/29/2017
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    Puerto Rico is a part of the U.S. and should not be penalized with a tax fro transporting good within the U.S.

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  • Andrea
    11/29/2017
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    Dear VA Reps and Senators: Please push for the removal of a requirement in the current tax bill that would put a 20% tax on Puerto Rican goods sold to the mainland U.S. This is very harmful measure that would hurt Puerto Rican businesses who are still trying to recover from hurricane Maria. Thank You!!

    Like (17)
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  • Neal
    11/29/2017
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    Hasn’t the Americans in PR been through enough? They haven’t even gotten the relief that they need after two hurricanes. You have already given money to loser companies that did not even help them. NOW THIS!? ENOUGH IS ENOUGH! Start helping these people and quit hurting them!!

    Like (8)
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  • John
    12/14/2017
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    No import taxes between states and/or territories. This is just plain stupid. Who thinks up this shit?

    Like (7)
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  • Lexpost
    11/29/2017
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    This is absurd. Puerto Rico, while not a state, is still populated by American citizens. Charging an import tax on the island is like taxing products from New York that go to other states. Even if this somehow acceptable, it is the wrong time in the recovery from the hurricanes this summer.

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  • Mindful
    11/30/2017
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    What’s the matter with you! Isn’t our Territory suffering enough? No 20% import Tax. Instead, give Puerto Rico all the help as you have given to Texas et al.

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  • Harmony
    12/14/2017
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    A 20 percent import fee on products going to the mainland? This kind of outrageous fee applied to one’s own territory sounds very familiar, a little reminiscent of the bumpy start of our own country. Taxation without representation ring any bells? If Congress does not exempt Puerto Rico from the excise tax, then it will have made its own bed and cannot complain when the population of Puerto Rico arrives on our shores in even greater numbers in the coming months and years because Puerto Rico’s economy has been devastated beyond repair. Rebuilding from long-term devastation is going to be even more expensive than repairing it after a natural disaster. Please discuss this before you make this economically foolish decision and especially before you do this terrible thing to these people.

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  • Jesse
    12/14/2017
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    The GOP don,t really care about PR at all

    Like (3)
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  • David
    11/30/2017
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    The United States has sent billions of dollars in aid and supplies, with a percentage of this which has been donated personally by the President. Israel sent 500 men with more supplies; and donations have been made by millions of others. These Puerto Ricans are asking for two much! It has been months since Irma and Maria. Florida and Texas recovered completely with little aid, less financial aid in only a month! I say that the government has done its part, and the President has exceeded what was necessary. We are not going to put the government in poverty due to hurricane recovery. For those who are against me on this, why don’t you send most of your money to Puerto Rico and send all that you have?

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  • Rebecca
    12/14/2017
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    The GOP tax bill was completed in extreme haste and secrecy. How unsurprising that it contains extraordinarily damaging provisions such as this one, which will harm the American citizens living in Puerto Rico! This appalling tax bill must die!

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  • John
    11/29/2017
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    Typical Conservative ploy...bleed the domestic poor to gain personal wealth and power. Wake Up!!!

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  • Patty
    12/14/2017
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    Remove the 20% tax on Puerto Rico. These are Americans trying to recover from a massive natural disaster.

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  • Jeff
    12/14/2017
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    It’s time to repeal the Jones Act, and to make Puerto Rico a state. The fact that there has been no movement in Congress on these crucial issues is awful. To add insult to injury by adding a import tax is cruelty. Do the right thing for your fellow Americans and get this garbage provision out of the tax bill.

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  • Kathy
    11/29/2017
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    We set up the debt crisis in puerto rico territory and now the white supremacist republicans and trump want to charge a 20% tax to hurt them because they are not white Americans. The jones act should be suspended and burney sanders an senator harris's bill should be implemented! But WHY WOULD THESE THINGS HAPPEN! Trump retweeted anti muslin violent nazi videos this morning, this is the republican party! When did it become acceptable to have an open white supremacist who broadcasts hate-speech as the president of the United States? This must not be normalized, we must drive them out.

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  • Debbie
    12/14/2017
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    How many ways can we hurt and disenfranchise the Puerto Rican people; isn’t it bad enough POTUS thinks it is a separate country. Keep voting along your party line and VA 10th will vote with our conscious.

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  • Ann
    11/29/2017
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    There’s a portion of the tax bill that calls for a 20% tax on goods from Puerto Rico coming to the mainland US. This is an unjust burden on a people who have been dealt a severe blow by nature. We should be trying to facilitate their recovery rather than pushing them down. Our “relief” efforts have been grossly inadequate. This is an embassment for the US before the world. We wouldn’t treat our allies like this but our fellow Americans—it’s fine.

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  • Keri
    11/29/2017
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    This is not a tax reform this is a tax cuts for the wealthy and it’s absolutely not OK so the only people that are happy about this are the wealthy and corporate companies They need to pay their fair share

    Like (1)
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  • Azrael
    11/29/2017
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    What is wrong with congress? Fix it

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  • Gilbert
    12/14/2017
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    A message to my representatives: Kill this tax bill. You know it’s wrong and we expect you to do the right thing. The American public will hold You responsible in the next election.

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  • Gail
    11/30/2017
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    Of course it hurts Puerto Rico! Remember, the tax plan is meant to help the rich by robbing everyone else including our children and their future. This our new moral creed: greed, ugly, repulsive greed.

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