Puerto Rico

Fiscal transformation to move the island forward

Fiscal transformation to move the island forward

The changes that the Treasury Department has recently implemented in the digital registration system for income tax returns should serve to strengthen collection mechanisms, as part of the efforts to strengthen Puerto Rico’s public finances.

We expect that changes in the tool to comply with tax responsibilities, adopted as part of the changes that started in 2016, will strengthen taxpayers’ confidence in the agency that must encourage compliance with tax responsibility.

According to the Treasury Department, The Internal Revenue Unified System (SURI, Spanish acronym) for the digital filing of corporate and individual tax returns consolidates in a single platform three separate registration tools for the management of taxes on income and on sales and use tax, paid by individuals and corporations.

The agency expects this system will help to improve tax administration. It is part of a modernization effort that would allow taxpayers to access relevant information online, such as the processing of refunds or filing extensions.

It will be helpful for the agency to follow taxpayers’ experiences with the system, to work on any deficiency that may affect its effectiveness.

In the immediate term, it is important that the Department comprehensively educates taxpayers about the use of the new SURI to clarify doubts to those sectors that express concerns or obstacles in using the tool, including self-employed workers, as well as small and medium businesses.

The system should facilitate the work of tax service providers who are often used by individuals and corporations committed to their tax obligations.

The new system involved a $45 million investment. It will be necessary for the government to maintain strict controls and proper maintenance to ensure the highest long-term performance. The new system does not include previous years tax records. Those reports will remain on the other platform, called Colecturía Virtual, so it will be essential for the Treasury to protect it as well.

According to the agency, between February 24 and 26, approximately 30,000 taxpayers filed their income tax returns using the new SURI. The expectation is that 860,000 taxpayers will complete the process on or before April 15, when the term to comply with the annual tax liability expires.

According to the agency´s projections, the proper operation of the system would imply that about 70 employees of the Payroll Processing Department would be tasked with analysis work. We expect these higher productivity and performance expectations will be met.

These goals associated with the updating of SURI could also serve as a model for other Treasury services and responsibilities, particularly initiatives to fight tax evasion.

These technological advances in the Treasury must join other efforts directed to oversee exemptions. This would allow, for example, to systematically consider eliminating preferential treatment without substantial economic or social benefit to the island.

Processes related to tax responsibilities must be based on transparency and rigor in managing people’s revenues which are essential to boost the well-being of the population and the progress of the island.

We hope this renewal of the digital registration system for income tax returns is part of a transformation that advances achieving the fiscal restructuring necessary for Puerto Rico´s reconstruction.

Sources: metro.pr

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