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The tax reform was approved in the House with 28 votes in favor and 20 against. (GFR Media)

Without the guarantee of the Board's endorsement, last night the Legislative Assembly passed the version of the tax reform that not only legalized slots machines but also postponed the reduction of the Sales and Use Tax (SUT) on prepared food to October 2019.

The tax reform was approved in the House with 28 votes in favor and 20 against, among those, PNP José Aponte Hernández, Nelson del Valle, Luis “Junior” Pérez and Ángel Bulerín.

While in the Senate, the bill had 19 votes in favor and 9 against, including those of the minorities and PNP senator Eric Correa.

 “In order to establish the “buffer zone”, we postponed the SUT reduction on prepared food. Instead of coming into effect in February, it will be in October,” said House president Carlos “Johnny Méndez”.

As part of the amendments anticipated by Méndez, each operator can have a maximum of 250 slots machines instead of 500.

Although amendments are part of the agreements reached between the Legislature and the government to comply with the 20 million contingency line required by the Board, Méndez said he did not know if the Board is satisfied with the changes.

 “Experience tells me that even though I may meet with Ms. (Natalie) Jaresko now and reached some agreements, tomorrow they may change everything…nothing coming from the Board surprises me anymore,” remarked Méndez.

He acknowledged not to have discussed the amendments with the Board´s executive director Natalie Jaresko. “We followed what we agreed during the meeting in my office and there has not been any further communication regarding changes to those agreements,” he said.

Méndez was referring to the meeting held with Jaresko, two weeks ago, when they were demanded an increase in government savings guarantees to address any possible problem caused by the implementation of the reform; studies that validate that the legalization of more than 25,000 slot machines will not have an adverse impact on government revenues and add language that limits the powers of the Secretary of the Treasury to establish tax agreements with debtors.

Despite the fact that the Legislative Assembly delivered the studies that -they consider- validate that the legalization of slot machines will not have an adverse effect on government revenues, Jaresko said on Monday that she had not received the Legislature´s documents that justify the new public policy.

“Until such time as the Oversight Board can be convinced with data and surveys that demonstrate the VLT (video-lottery) proposal will not cannibalize existing Fiscal Plan revenues, it is the Oversight Board’s perspective that this portion of the bill is not revenue neutral and remains inconsistent with the Fiscal Plan,” said Jaresko 24 hours before the Legislature addressed the bill. 

Rejection to mayors succession bill

The House did not pass Senate bill 1133 that will leave to municipal delegates the selection of a mayor successor. The bill was rejected by 29 votes against and 19 in favor.

Initially the measure was approved by voice vote.

Those PNP who voted against the measure were José “Pichy” Torres Zamora, Luis “Junior” Pérez Ortiz, Urayoán Hernández, Juan Oscar Morales, Ángel Peña Ramírez, Michael Abid Quiñones, José “Che” Pérez, Félix Lasalle,  Antonio “Tony” Soto, José A. Banchs, José “Memo” González and José Aponte Hernández.

Meanwhile, lawmakers María Milagros Charbonier and Lourdes Ramos did not vote.

Popular Democratic Party (PPD) delegation voted against the measure as well as the Puerto Rican Independence Party (PIP) representative Denis Márquez.

In the Senate, it had 16 votes in favor, the minimum required to pass a bill and 10 votes against, including that of the Senate vice president, Larry Seilhamer.

Other measures approved

Both bodies passed Senate bill 479 that creates the Auxiliary Secretariat of Montessori Education.

Senator Migdalia Padilla, author of the measure, explained that as part of the agreements reached with the Chamber, they restored the language that stated that the Auxiliary Secretary of Montessori Education will be recommended by a committee composed of a representative of the New School and two representatives of the Montessori schools of the agency.

Meanwhile, contrary to the proposal of the Chamber, they maintained the requirement that those interested in that position should have a certification, as well as experience, in the Montessori teaching model. The House version limited the requirements to experience in school administration.

House bill 1484 that would create the Law of Educational Services to Children with Disabilities in Puerto Rico was also approved, as well as Senate Bill 477 - a measure that would enable the development of a municipal micro-grid that will provide electricity to five mountain villages


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