On 29 December 2015, Puerto Rico's Treasury Department issued Administrative Determination 15-26, which details a two-phased approach for the implementation of value added tax (VAT) in the country. A 10.5% VAT will replace Central Sales and Use tax (SUT) in Puerto Rico beginning 1 April 2016, although the 1% Municipal SUT will continue to apply.
From 1 April 2016 (phase one):
- Supplies subject to 10.5% Central SUT will be subject to 10.5% VAT;
- Supplies of services (B2B and certain profession…