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Wednesday, June 14, 2006 

Wednesday, June 14, 2006

Aponte’s taxes to affect salaried workers
By Yaisha Vargas

SAN JUAN (AP) – The tax measures that House Speaker José Aponte is preparing parallel to the tax reform being prepared by the House Treasury Committee and Rep. Antonio Silva will harm the salaried workers and attract money to the subterranean economy.

Treasury Secretary Juan Carlos Méndez affirmed Tuesday that he found about the House leader’s ideas through the press because he doesn’t have very good communication with him. He assured that he talks constantly with Silva, who is in charge of shaping the tax reform in the House.

"It appears that these taxes will really benefit the tax evader and those who live in the cash economy," Méndez said in a press conference at La Fortaleza after meeting with Gov. Aníbal Acevedo Vilá and other economic cabinet officials.

The Treasury secretary vehemently opposed the proposals that are allegedly being prepared by Aponte that consist of a 10% tax on the remittance of funds abroad, another 1 to 2% on credit card purchases, and also a 10% on the properties with a value over $500,000.

With these three tax measures, Aponte seeks to generate the $400 million in additional income that the government needs to face the structural deficit and balance the budget of next fiscal year.

Méndez reiterated that none of these three taxes can capture the cash transactions and that the only mechanism that can collect the money that is circulating in the subterranean economy is the sales tax.

Secretary of State Fernando Bonilla mentioned that “enormous doubts” exist in the executive about Aponte’s measures and Government Development Bank President Alfredo Salazar said he needs concrete information about the tax reform to be able to take it to the credit agencies in New York.

"We are anxious for [the legislators] to finish their job and tell us so that we can then defend the credit of Puerto Rico. I can’t sit in front of these men [the credit agencies] if I don’t have the tools," Salazar said.

The three official said the only thing left for them to do is wait for the Legislature to inform them about the legislative measures related to the tax reform.

Meanwhile, the executive branch is holding a bond emission of $675 million that would benefit the municipalities because it would imply a new Puerto Rico credit degradation, Salazar said.
"Since we couldn’t paint a complete picture [of the financial situation of Puerto Rico], we opted to withdraw the emission with the advice of the bankers who are working on the financial transaction," he said.

Only 12 days are left for the approval of the budget, which also depends on the finalizing of the tax reform.

Meanwhile, statehood Sen. Orlando Parga roared Tuesday against Aponte’s alleged proposal to impose a tax on the sending of money abroad and credit card purchases.

For Parga, these measures would be a "hard blow to those in poverty".

"Don’t count on me if the eagerness to seek resources to settle the crisis in the government is to tie a rope around the neck of the citizen who lives on credit to sustain his basic needs and works hard day in and day out to send a little money to his relatives," he said in a press release.

"It is inconceivable that we want to convert the poor into beggars," said Parga, explaining that most citizens on the island depend on credit to adjust their monthly family budget and achieve access to the products and services that complement their daily life.

Regarding sending money abroad, he said most of this money, mostly from foreigners who arrived in Puerto Rico to work with dignity, serves to pay for medicines, food, and even minimal levels of shelter and clothing in countries like Cuba and the Dominican Republic.

"These measures threaten the quality of life and don’t have space nor consideration in the Senate," the senator said.

Copyright © 2000-2006 Casiano Communications Inc. All rights reserved.

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