Puerto Rico's tax regime after Act 40-2013

Its changes and implications, including the technical amendments bill proposal

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On 30 June, Puerto Rico enacted Act 40-2013 which includes significant changes to the Puerto Rico Internal Revenue Code of 2011, as amended, principally in the area of sales and use (SUT) and income taxes.

Act 40-2013 is one of the various tax and nontax measures that the Governor of Puerto Rico approved for the government’s budget for fiscal year 2014 and forward. Please join us as we address these new and controversial tax measures.

Topics to be discussed are based on the current environment and will include the following:

  • Corporate tax changes
  • Tax credit moratorium
  • SUT changes including elimination of reseller and certain business to business (B2B) exemptions
  • New nexus rules and payment of use tax on introduction
  • Effective dates
  • Income tax provision implications

This program will be of particular interest to tax directors, directors of state and local tax, and controllers.


Faranak Naghavi

Ernst & Young LLP, National Director Sales and Use Tax

Faranak Naghavi is Ernst & Young LLP’s National Director of Sales and Use Tax Services. She oversees a network of 150 transaction tax professionals located in the North American tax practice of Ernst & Young LLP. Faranak has extensive experience in all areas of state and local taxation, with particular emphasis in manufacturing, technology, communications, entertainment, and health care. She has been involved in state and local taxes for the last 23 years and has worked in both the government and public accounting sectors.

Prior to joining Ernst & Young LLP in 1991, Faranak was employed by the State of Louisiana Department of Revenue and Taxation as a sales and use tax auditor.

Faranak holds a B.S. and an M.S. in Accounting from Louisiana State University.

Rosa M. Rodriguez

Ernst & Young Puerto Rico LLC, Business Tax Advisory

Rosa Rodriguez is an Executive Director in the Tax Advisory Division of the Tax Department of Ernst & Young Puerto Rico LLC. She has 25 years of experience in both Public Accounting and government, with extensive experience serving clients in various industries, including the technology services sector.

Rosa is a Former Assistant Secretary for Internal Revenue Area. As part of her three years experience with the Treasury Department, she worked, with review and draft of tax legislation, rulings, and tax exemption approval, revenue collection, managing of a workforce of nearly 3,000 employees through seven (7) bureaus, more than 100 collectors’ offices, and five (5) regional administrative offices.

Rosa holds a bachelor in business administration with a major in accounting from the University of Puerto Rico. Rosa is a Certified Public Account in Puerto Rico.


Teresita Fuentes

Ernst & Young Puerto Rico LLC, Tax Market Leader

Teresita Fuentes is a member of the Tax Advisory practice in the Ernst & Young member firm in Puerto Rico. She is the Tax Market Leader of the Puerto Rico office. Teresita serves clients in the biotechnology, pharmaceuticals, consumer products, retail, technology and telecommunications industries.

Teresita has over 25 years of experience in tax practice and administration, both in public accounting and government. Prior to joining the firm, Teresita was with the Puerto Rico Treasury Department as Assistant Secretary for Internal Revenue. She actively participated in the 1994 Tax Reform, which culminated in the Puerto Rico Internal Revenue Code.

Teresita received a bachelor’s degree in business administration with a major in accounting from the University of Puerto Rico. She is a certified public accountant licensed in Puerto Rico.