Act No. 20-2012, as amended, known as the “Export Services Act” (“Act 20”), was created to “export” services from Puerto Rico businesses – meaning that in order to be eligible for Act 20 benefits, a Puerto Rico business must provide services to a business outside of Puerto Rico. Act 20 benefits include:
- 4% fixed income tax rate on eligible income
- 100% tax exemption on dividends
- 100% exemption on property taxes
- 60% exemption on municipal license tax
- 20-year grant period, subject to renegotiation for another 10 years
Although you may no longer request a new Act 20 decree, listed below are some of the business activities, markets, services and products that allowed you to receive the tax exemptions and business incentives under Act 20:
- Shared service centers and centralized managerial services
- Call centers
- Financial services
- Research and development
- Advertising
- Public relations
- Consulting services
- Graphic design
- Architectural services
- Engineering services
- Software development
- Telecommunications
- Medical services
- Laboratory services
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