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U.S. Federal Taxes in Puerto Rico (CRS Report for Congress)

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Release Date Oct. 30, 2000
Report Number RS20718
Report Type Report
Authors David L. Brumbaugh, Government and Finance Division
Source Agency Congressional Research Service
Summary:

U.S. federal taxes generally do not apply to individuals in Puerto Rico, with the exception of Social Security taxes. Instead, Puerto Rico levies its own taxes, at a level higher than those of most U.S. states, but lower than that of the federal government. For businesses, a partial federal tax exemption is provided by the Puerto Rican economic activities credit and the possessions tax credit under sections 30A and 936 of the Internal Revenue Code.