2023 Laws of Puerto Rico › TITLE TWENTY-ONE - Municipalities (§§ 1-4 — 6756) › Subtitle 3 - General Provisions (§§ 621-639 — 1100a) › Chapter 71 - Municipal License Taxes (§§ 621-639 — 652y) › § 651b - Authority to levy license taxes

Municipal legislatures of all the municipalities of the Commonwealth of Puerto Rico are hereby authorized to levy and collect, pursuant to the provisions of §§ 651–652y of this title, on and from every person engaged in the rendering of any service, or in the sale of any goods, financial business and/or any industry or business, except as otherwise provided, the taxes hereinafter enumerated at the rates herein prescribed or at such uniform percentage of rates as municipal legislatures may prescribe for each group comprised in subsections (a) and (b) of § 651d of this title. The proceeds thereof shall be used to cover the budgetary expenses; Provided, That if any municipality shall levy said tax at a rate less than the maximum prescribed herein on any industry or business subject to a license tax under the provisions of §§ 651–652y of this title, a proportional reduction from said maximum rates shall be made for every industry or business within said municipality.
In the case of persons with offices or warehouses which are separate and different from any business or industry carried on at the main or principal office of said organization within the same municipality they shall be taxed separately; but in the case of businesses or industries carried on at the main office as well as at any of its branches or warehouses within the same municipality the tax shall be levied on the main office only, but on the basis of the total volume of business of the industries or businesses carried on at both, the main organization and all the branches and warehouses thereof. Provided, however, That in the case of industries or businesses having their main organization in a particular municipality and having other commercial or industrial organizations, offices, branches or warehouses doing business in municipalities other than the one in which the main organization is located, the license tax shall be levied by each municipality where the main organization has offices, branches, warehouses or any other commercial or industrial organization on the basis of the volume of business carried on by or in the name of the main organization in said municipality.
In those cases in which the operations of a business are carried out in two (2) or more municipalities, the computation of the license tax shall be made by prorating the volume of business taking as average base [sic] the number of square feet of the areas of the buildings used in each municipality during the taxable period of the calendar year preceding the date of filing of the license tax. In the case of businesses engaged in manufacturing, this formula shall be used regardless of whether the person who operates said manufacturing business commences the manufacturing process of its products in one municipality and sells them in another. In the case of businesses engaged in telecommunications services, the areas of the buildings used in each municipality include the parking areas of the buildings owned by the person who operates the telecommunications services business. This formula shall not apply to those businesses whose volume of business may be determined as established in paragraphs (A)–(G) of subsection (a)(7) of § 651a of this title.
The power granted by §§ 651a–652y of title to the municipalities to levy municipal license taxes on the volume of business carried out by persons or entities within their territorial limits shall in no way be interpreted as to deprive or limit the power of the municipalities to levy income or excise taxes, duties, licenses, fees, rates and tariffs on any other item that is not incompatible with the taxes imposed by the Commonwealth, when the objects or activities subject to taxation are carried out within the territorial limits of the municipality. The taxing of an object or activity shall be deemed as a separate and distinct act, not included or inherent to the tax imposed on the volume of business that serves as a basis to impose the municipal license taxes.
—July 10, 1974 No. 113, Part 1, p. 371, § 3; Nov. 14, 1974, No. 4, Part 2, p. 718, § 1; Nov. 17, 1992, No. 93, § 2; June 24, 1998, No. 96, § 2.
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