PIP Stance On Puerto Rico's Economic Crisis and Taxation System
During the 2005-2007 Puerto Rico economic crisis, the Puerto Rican Independence Party submitted various bills that would have taxed corporations making $1 million or more in annual net profits an extra ten percent above the average tax rate these corporations pay, which hovers around 5%. The PNP and the PPD parties amended the bill, taxing the corporations the traditional lower rate, while the general population was taxed at a ceiling of about 33.3% for income tax plus a 7.5% sales tax. Despite objections presented by the PIP, the PNP and PPD also allowed the companies to claim the additional tax as a credit on next year's bill, making the "tax", in effect, a one-year loan. Puerto Rico has been said "There is no place in the territorial limits of the United States that provides such an advantageous base for exporters. " Because of this, many US companies moved their headquarters and manufacturing facilities there. This is why the PNP and PPD believed the tax increase would exacerbate the problems
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