Exemption of Payment of SUT on Prepared Foods Due to the Recent Seismic Activity in Puerto Rico
Due to the state of emergency caused by the recent seismic activity experienced throughout the Island, the Secretary of the Treasury Department (TD) announced the immediate elimination of the collection and payment of the Sales and Use Tax (SUT) until 11:59 pm of January 31, 2020.
To this effect the TD issued Administrative Determination 20-01 (DA 20-01) to inform that individuals are exempt from paying SUT on taxable items considered as prepared foods, which includes carbonated beverages, baked goods and pastries as defined by the Internal Revenue Code of Puerto Rico.
DA 20-01 points out that the merchant must inform these sales on the Monthly SUT Tax Return (Model SC 2915), on the line titled “Sale of Exempt Tangible Property”.
It also emphasizes that the SUT exemption does not apply to the sales of alcoholic beverages.
The TD encourages all consumers to claim the exemption as stated on DA 20-01. In case a merchant, either by action or omission, collects SUT on any prepared foods sale, he will be obliged to reimburse the amount to the consumer and will be subject to the penalties imposed by the Code.