OPEN LETTER TO SENATE FINANCE COMMITTEE CHAIRMAN: THE HONORABLE ORRIN HATCH:
April 3, 2015
The Honorable Orrin G. Hatch
Chairman
Committee on Finance
United States Senate
Chairman
Committee on Finance
United States Senate
We count on your support to
advance our struggle to achieve equal rights for the almost 4 million
disenfranchised US citizens in Puerto Rico. I write to you at a critical
moment in our Nation's history. Your fellow citizens in Puerto Rico need
you in order to be part of the final tax and spending agreement.
This is a historic
opportunity to redress an injustice that was made against the People of Puerto
Rico in 1921, when Congress decided to treat Puerto Rico as a "foreign
country" for tax purposes. While Congress approved the 1921 exclusion
in order to promote economic development, this commendable objective has not
been achieved in almost a century. Puerto Rico continues to fall behind all the
states in the Nation, mired in economic, social and demographic stagnation for
more than a decade.
Unfortunately, the 1921 tax
exclusion that Congress established to help Puerto Rico has been transformed
into a significant drain to the US Treasury, victim of well-documented transfer
pricing abuses by the "Controlled-Foreign Corporations" (CFCs) in the
Island. There is no economic or moral justification to allow a U.S. corporation
to have tax savings of $22 million per employee in Puerto Rico.
This is the right moment to
draft legislation to finally include Puerto Rico in the U.S. tax code, with all
the responsibilities and privileges of US citizens. This historic change can be
achieved by deleting Section 933 of the Internal Revenue Code,
and defining corporations incorporated in Puerto Rico as U.S. Corporations,
for tax and other purposes.
With Puerto Rico´s full
inclusion in the tax code, Congress can stop transfer pricing abuses and create
effective tax benefits that generate real jobs and promotes tangible
investments in Puerto Rico through specific legislation that treat US citizens
in the Island in a manner similar to other communities in the 50 states. There
is a real opportunity to draft effective legislation for Puerto Rico that
creates a direct link between each dollar of federal tax benefits to a job,
similar to the Earned Income Tax Credit that have benefitted residents in the
50 states since 1975. In addition,
Federal tax benefits to generate real investments in Puerto Rico can be
designed similar to the provisions in Enterprise Zone acts and the Promise Zones
legislative proposals of President Obama.
Bringing back Puerto Rico as
a full partner into the federal tax system would carry significant benefits to
the People of Puerto Rico and the US Treasury, but are not possible without
your strong commitment to carry them through to the final budget agreement.
As you know, there are formidable moneyed interests that benefit from
using Puerto Rico as a tax heaven, and they would not give up the hugely
inefficient tax deferral benefits without a fight. The almost 4 million
disenfranchised US citizens in Puerto Rico count on your support to secure our
equal rights and responsibilities.
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| Puerto Rico From Space |
Thank you,
Miriam J. Ramirez MD
Please help us and express your support to our position to Senator Hatch. Thank you.
Sen Hatch email Contact:
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