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PuertoRico2015

/////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////// “AFTER UNDERTAKING MY OWN RESEARCH, I WAS AMAZED THAT THE WORLD KNEW NOTHING OF THE INTERNATIONAL INSURANCE CENTER PLATFORM. I THEREFORE SET OUT TO UNDERSTAND IT MYSELF AND ITS IMPLICATIONS FOR PUERTO RICO AND THE VAST WORLD OF INSURANCE AND REINSURANCE. WITH 50 YEARS IN THE LONDON MARKET I CAN RECOGNIZE A GOOD THING IN THE MARKET WHEN I SEE IT: PUERTO RICO” Colin Spreckley, former Chairman of a major Lloyds Managing Agency /////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////////// INTERNATIONAL INSURERS ARE SUBJECT TO AN ANNUAL LICENSE AUTHORIZATION RENEWAL FEE BASED ON PREMIUM LEVEL ANNUAL PREMIUM (No greater than) ANNUAL FEE by the international insurer and international insurance holding company • Exemption on municipal franchise, real and personal property taxes • Exemption to the international insurer and qualifying international insurance holding company from withholding taxes on payments of dividends and other profit distributions made to third parties • Isolation of the proceeds and benefits paid by international - 5 - insurers from state and donation taxation procedures • International insurers are also subject to an annual license authorization renewal fee • Tax treatment guaranteed by a 15 year tax decree, renewable for two additional 15 year periods SUITE OF PUERTO RICO TAX INCENTIVES DRAW INTERNATIONAL INTEREST & INVESTMENT In addition to the tax exemptions provided under the International Insurers and Reinsurers Act of Puerto Rico, companies seeking to move insurance operations to Puerto Rico can also benefit from the island’s larger set of economic incentives. In an effort to bolster Puerto Rico’s economic development, the local government is focused on promoting business through tax laws, which serve to attract insurance companies, investors and offshore financial services firms and to stimulate the export of services. In addition to Act 399, these laws include: • Act 20 (Knowledge Services): Offers several tax incentives, including a 4% flat tax rate, for a wide variety of services provided from Puerto Rico to clients off the island, including capital investment services, software development, data processing centers, among other service industries • Act 22 (Individuals): Offers tax benefits to new residents of Puerto Rico (requires 183 days of living in Puerto Rico , minimum). under Act 22, interests, dividends and capital gains could be 25,000,000 $5,000 50,000,000 $10,000 75,000,000 $20,000 100,000,000 $35,000 150,000,000 $50,000 250,000,000 $65,000 > 250,000,000 $75,000


PuertoRico2015
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