VAT rates in Puerto Rico

Quick overview

Standard Rate	Reduced Rate	Other Rates
10.5%	4% & 7%	Exempted

The local name for VAT in Puerto Rico is HERE.

There are basically 4 VAT rates in Puerto Rico:

• Standard VAT rate is 10.5%
  • The 10.5% is the State Tax and is increased by a 1% Municiapl Tax
• Reduced VAT rates are 4% & 7%

Recent developments

For more information about (recent) rate change developments in Puerto Rico, please click HERE.

Standard rate: 10.5%

This rate applies for all transactions that take place in Puerto Rico, unless an exception applies (such as a reduced rate, the zero rate or an exemption, or a reason to treat the transaction as outside scope of VAT).

Reduced rate: 4%

• B2B Services
• Professional services

Reduced rate: 7%

• Prepared food

Exempted

• Certain food items
• Funeral services
• Prescription medicines
• Machinery and equipment used in exempt manufacturing operations
• Medical-surgical material
• Childcare centers
• Commercial and residential real property leases
• Printed and electronic books
• Feminine personal hygiene

A global VAT/GST rate overview can be found here (note this is a work in progress).

This post was last updated on November 4, 2021.

See also Global VAT/GST rate overview

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