PUERTO RICO: Calderon visits Washington to lobby Congress for Section 956

The San Juan Star | Tuesday, October 2, 2001 | By ROBERT FRIEDMAN: STAR Washington Bureau

[4Freedom]

WASHINGTON - Gov. Calderon began on Monday a two-day lobbying effort here for Section 956 amid questions over whether, in the wake of the Sept. 11 terrorist attacks, Puerto Rico should get a special, permanent tax plan different from the economic initiatives the rest of the nation could receive.

While Sen. John Breaux, D-La., cited the need for the 956 plan to help the island, which he said could suffer severe economic aftershocks from the attacks, some critics say there is no need to give such special treatment to the island.

Critics note that the economy-spurring tax programs under consideration for the states also would apply to Puerto Rico. They also note that Senate Finance Committee Chairman Max Baucus, D-Mont., and Sen. Charles Grassley, R-Iowa, the committee's ranking Republican, have both said they would work toward temporary tax relief to reignite the economy.

The 956 plan, as being pushed by the Calderon administration, calls for a permanent change in the tax structure to help the island.

The temporary plans for the nation under consideration include corporate and capital gains tax cuts, capital investment write-offs and a payroll tax cut on employees' Social Security and Medicare payments.

Whereas the Bush administration's earlier income tax rebates did not apply to the island, all the programs now being mulled would apply to Puerto Rico, said a source close to Congress.

"Commonwealth government employees, and all other employees, have Social Security deducted from their pay checks," the source noted. "Why give Puerto Rico additional economic help that other areas of the nation would not be getting?"

Breaux, in introducing a 956 bill in the Senate last week, noted that the island's economic downturn depends more than other areas on tourism and the airlines.

Attorney Charlie Black, the commonwealth's principal 956 lobbyist, did not object to special treatment for the island, saying "Puerto Rico always has been treated differently on tax laws."

Black said the island "would be happy" to have 956 included in the administration's forthcoming economic stimulus package.

Calderon, meanwhile, met Monday with Sen. Jeff Bingaman, D-N.M., a member of the Finance Committee, to try to get him on board for 956. She told reporters the senator promised to "evaluate" the plan.

The new island incentive would amend Section 956, the controlled foreign corporation provision of the federal tax code, to allow U.S. companies in Puerto Rico to operate as CFCs, and to repatriate at least 90 percent of their profits tax free. Under the current CFC provision, the companies must pay the full 35 percent tax rate on profits brought back to the states.

[4Freedom]

"Puerto Rico always has been treated differently on tax laws."

Man, that's no understatement either.

Over the past 5 or 6 decades there's been Section 906, 916, 926, 936 and, now, just as 936 is being phased out, they want it replaced with 956!

Under Section 936 the Pepsi and Coca Cola corporations saved around $390 THOUSAND DOLLARS in federal taxes per job they created in Puerto Rico! It cost the U.S. Taxpayers BILLIONS for jobs that were going to be created there ANYWAY!

DOES ANYONE BELIEVE PEPSI AND COKE WOULDN'T HAVE GONE INTO THE PUERTO RICAN MARKET ANYWAY?

Our U.S. Taxpayer's dollars didn't go into the average Puerto Rican's pockets. Our tax dollars went into the coffers of a bunch of pandering politicians on the island and Stateside to fund their campaigns. Governor Sila Calderon even used a few million to try and evict the U.S. Navy off of U.S. Taxpayer owned property on Vieques.

To paraphrase President Bush, "make no mistake about it" this is just the latest attempt to RIP-OFF the U.S. Taxpayers and create another WINDFALL OF OUR CASH for the corrupt and ungrateful in Puerto Rico!

[4Freedom]

No, I don't think much of the windfall went to the average resident of PR, directly. I think alot of it went into the pockets of the "corrupt and ungrateful" blood-sucking politicians in Puerto Rico and the U.S. mainland to further influence Stateside elections and legislation.

I believe that the fact that the largest single donation to Bill Clinton's re-election campaign, $250,000 in '96, and others came from Puerto Rico had a lot to do with his Vieques decision, release of the Puerto Rican terrorists and an increase in Medicare funding to the island.

They use our money to buy influence with stateside politicians to send them more of our money. They use our social programs to land their excess population in cities where they can influence the outcome of Stateside elections.

I believe that the latest $150,000 that Jeb Bush received at a fund-raiser in Puerto Rico along with all of the other 100's of thousands that the Bush family received for their campaigns from Puerto Rico has alot to do with W's Vieques decision. It's payback.

We unwittingly allow our politicians to use our own tax dollars against us.

[4Freedom]

I guess we agree on everything to do with these issues.

One question I have though is did I write something that implied that the politicians in Puerto Rico were only getting away with $250 thousand?

The U.S. Taxpayers are gifting $30 billion dollars or so each year in cash and federal government services to Puerto Rico. The politicians and their cronies are making off with millions of it each year.

I think it's very telling that the largest single campaign contribution to Bill Clinton's re-election campaign wasn't from some Hollywood Star, sports figure or silicon valley billionaire. It comes in from some schmuck that's on the books as owning a hospital that serves Medicare patients, almost exclusively, in a country that's supposedly poorer than any of the 50 States.

There's something real fishy going on down there and it's going on because it's almost completely off the U.S. Taxpayer's radar screen. At least until now.