Inflation Reduction Act: the impact of minimum tax is uncertain

Puerto Rico Treasury Secretary said they will wait for the USTreasury and the IRS to determine whether Act 52 will have to be amended.

August 25, 2022 - 1:10 PM

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Two days after Biden signed the IRA, the Board wrote to Governor Pedro Pierluisi to indicate that while it supported initiatives such as Act 52, it was also necessary for the government to ensure that changes in state law - which go beyond the foreign tax - as well as the IRA would not affect tax revenues. (Agencia EFE)

By Joanisabel González

Editora de Negociosjoanisabel.gonzalez@gfrmedia.com

Treasury Secretary Francisco Parés Alicea said he is confident that the Internal Revenue Service (IRS) will issue, in the next few weeks, the decision that will formally establish the new tax regime on controlled foreign corporations (CFCs) in Puerto Rico, but he acknowledged that it is still too early to determine the impact that the approval of the new alternative minimum tax (AMT), that the federal government will apply to these and other entities, will have on the island.