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Packaging Firm (Ag products only)
Tax incentive for packaging firms specializing in agricultural products, supporting value-added agriculture.
7 min
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Section Code:
2081.01(a)(2)(vi)
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Purpose:
Agroindustry — 2081.01(a)(2)(vi)
Overview
The Packaging Firm (Ag products only) designation under Section 2081.01(a)(2)(vi) of Act 60-2019, as amended, provides preferential tax treatment for packaging operations that package agricultural products. This designation supports value-added agricultural processing by incentivizing packaging services that prepare agricultural products for market.
Qualifying packaging firms may receive reduced corporate income tax rates, property tax exemptions on packaging facilities and equipment, and municipal tax relief. The program attracts packaging operations serving agricultural producers and food processors.
The key distinction is its specific focus on agricultural product packaging rather than general packaging or non-agricultural products. These operations package fruits, vegetables, and other agricultural products.
Key Benefits
Reduced Corporate Income Tax Rate
Packaging firms may receive reduced rates on income from agricultural packaging services.
Property Tax Exemptions
Packaging facilities, equipment, and infrastructure may receive property tax exemptions.
Municipal Tax Relief
Packaging operations may receive exemptions from municipal license taxes.
Value-Added Agriculture
Packaging supports agricultural value-added activities and market access for agricultural products.
Requirements & Obligations
Agricultural Product Focus
Packaging operations must focus on agricultural products rather than non-agricultural goods.
Packaging Facilities
Operations must maintain appropriate packaging facilities meeting food safety and quality standards.
Food Safety Compliance
Packaging operations must comply with food safety regulations and sanitation requirements.
Employment
Packaging firms must employ Puerto Rico residents.
Reporting
Annual reports document packaging volumes, revenues, and employment.
How to Apply
Applications typically require four (4) to eight (8) months. Applications include packaging operation descriptions, facility plans, food safety programs, and financial projections. Upon approval, operators commence packaging operations.
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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