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Call Centers (Exports)
Tax incentive for call center operations serving external clients, offering a 4% corporate tax rate on customer service and support operations.
11 min
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Section Code:
2031.01(A)-1 (a)-19
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Purpose:
Exports — 2031.01(A)-1 (a)-13
Overview
The Call Centers export incentive under Section 2031.01(A)-1(a)-19 of Act 60-2019, as amended, provides preferential tax treatment for call center operations that provide customer service, technical support, and related services to clients located outside Puerto Rico. This designation supports customer contact center operations.
Qualifying businesses pay a fixed four percent (4%) corporate income tax rate on income derived from call center services provided to external clients. The program attracts call centers, customer service operations, technical support centers, and business process outsourcing companies providing phone, chat, email, and multichannel customer support.
The key distinction of this designation is its specific focus on call center and customer contact operations as a distinct service category. Call centers provide customer-facing support services on behalf of external companies or provide direct customer service for products and services sold outside Puerto Rico.
Puerto Rico's bilingual workforce is particularly valuable for call center operations serving U.S. markets with English and Spanish language support requirements. The incentive enhances Puerto Rico's competitiveness for attracting call center operations.
Key Benefits
Corporate Income Tax Rate
Call center operations approved under this designation pay a fixed four percent (4%) tax rate on income from qualifying call center services to external clients. This rate applies for the decree term of fifteen (15) to twenty (20) years.
Compared to standard Puerto Rico rates of thirty-seven and a half percent (37.5%), savings exceed ninety percent (90%).
Dividend Tax Treatment
Dividends distributed from decree income to shareholders outside Puerto Rico face zero percent (0%) withholding.
Property Tax Exemptions
Call centers receive exemptions from property taxes on call center facilities, telecommunications equipment, workstations, and technology infrastructure.
Municipal Tax Exemptions
Decree holders are exempt from municipal license taxes on qualifying call center revenues.
Bilingual Workforce
Call centers benefit from Puerto Rico's bilingual workforce capable of providing customer service in English and Spanish, valuable for serving U.S. markets.
Requirements & Obligations
Business Structure and Registration
Applicants must establish a Puerto Rico legal entity to conduct call center operations and hold the decree. The entity must register with Puerto Rico authorities and obtain necessary licenses.
Export Revenue Threshold
At least eighty percent (80%) of gross income must derive from call center services provided to clients outside Puerto Rico or supporting products/services sold outside Puerto Rico. Services supporting Puerto Rico products do not qualify. Detailed client and service records are required.
Call Center Services Definition
Services must constitute qualifying call center activities including customer service, technical support, sales support, help desk services, or other customer contact services. Services must be substantially performed from Puerto Rico.
Service Delivery from Puerto Rico
Call center services must be delivered from Puerto Rico-based facilities by Puerto Rico-based agents and support staff. Customer interactions occur from Puerto Rico call centers.
Employment Requirements
Call centers must hire at least one (1) full-time Puerto Rico resident employee within six (6) months of decree issuance. Call center agents, supervisors, technical staff, and management count toward requirements. Call centers typically employ substantial workforces.
Physical Presence
The business must maintain call center facilities in Puerto Rico where customer contact services are performed. Business records must be kept in Puerto Rico.
Compliance and Reporting
Annual compliance reports must document employment, revenue sources, client locations, and service volumes. Records must demonstrate call center services delivered from Puerto Rico for external clients or markets.
How to Apply
The application process for Call Centers export incentives typically requires four (4) to six (6) months from planning to decree issuance.
The process begins with call center planning and market assessment. Operators should define service offerings, assess client demand, plan facility requirements, and evaluate workforce needs. Call centers require appropriate facilities and substantial workforce recruitment. Consultation with Puerto Rico advisors helps optimize planning.
During planning, operators establish Puerto Rico legal entities and advance call center setup. This includes facility lease or development, telecommunications infrastructure installation, workstation setup, and workforce recruitment planning.
The formal application is submitted to PRIDCO and includes call center descriptions, service offerings, client base or target market analysis, facility plans, financial projections, and employment plans. Evidence of client contracts or commitments strengthens applications.
PRIDCO reviews the application over approximately sixty (60) to ninety (90) days. Staff may request additional information about services, clients, or operational plans. Call center operations creating substantial employment receive favorable consideration.
Upon approval, the decree is issued specifying terms and obligations. After issuance, the operator must establish call center operations, recruit workforce, and begin service delivery.
This information is educational and should not be considered legal or tax advice. Applicants should consult with qualified legal and tax professionals familiar with Puerto Rico incentive programs before making any business decisions or submitting applications.
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