Nuevo cabildero del Gobierno de Puerto Rico en Washington, D.C., que cobra $ 50-mil mensuales provoca pérdida de $ 100 millones de dólares con el asunto de los ingresos que EEUU devuleve de los arbirtrios del ron. Vamos a ver si lo despiden o están tan colonizados se colocan el rabo en el trasero! Tuesday, July 30th, 2013 Puerto Rico Report connect: Connect with us on Twitter Follow us on Facebook Receive our feed American flag and Puerto Rico flag Main menu Skip to content Featured History People Politics Polling Share this article Gov’t Lobbyist Also Lobbies for Policies that Cost Gov’t Millions Posted on July 30, 2013 The Government of Puerto Rico’s newest $50,000 a month lobbying firm continues to be a major lobbyist for policies that are costing the territorial government — and Puerto Rico’s economy — more than $100 million a year. The Podesta Group has been paid $50,000 every three months by Diageo, the world’s largest liquor company, to lobby on the policies since about the time that Robert Menendez (D-New Jersey) and four other U.S. senators of both national parties proposed amending the Federal law involved in April 2010. The amendment would have prevented much of the loss to Puerto Rico’s budget and economy. Diageo opposed the legislation. Menendez continues to work for its passage. Last month, he got the bipartisan staff of the Senate Finance Committee to include the proposal in a list of issues for a comprehensive reform of the Federal tax code. The Federal law involved gives Puerto Rico and the U.S. Virgin Islands most of the Federal tax on rum produced in the islands and in foreign countries. A primary purpose of the grants is to subsidize the insular governments, recognizing that the economies of the territories are underdeveloped in comparison to the States. A secondary purpose of the grants is to enable U.S. territory rum producers to compete against foreign producers in sales in the States. Of the $13.50 per proof gallon tax, the Federal government gives the islands $10.50 per proof on an ongoing basis. For several years, it has given an additional $2.75 of the remaining $3 per proof gallon. In 2008, the U.S. Virgin Islands agreed to give Diageo — a very profitable company — subsidies worth up to 47.5% of the Federal tax grants to the territory on the company’s Captain Morgan rum if Diageo would move production of the rum from Puerto Rico. The subsidies have been estimated to be worth $2.8 billion over 30 years. The bill by Menendez and other senators followed one by Puerto Rico’s representative to the Federal government, Pedro Pierluisi (statehood party), and other members of the U.S. House of Representatives of both national parties. The bills would have initially limited subsides to 10% of Federal rum tax grants to the territories. The measures were later revised to permit subsidies up to 15%. For many years, Puerto Rico had spent $25 million a year on promoting Puerto Rican rum — including Captain Morgan rum. The promotion amounted to about six percent of the Federal rum tax grants it received. Similarly, the U.S. Virgin Islands had for many years given its sole rum producer seven percent of the Federal rum tax grants it received. But it increased the subsidy to 30% of the grants before the Diageo deal. After the deal, the U.S. Virgin Islands agreed to give its original rum company, now owned by Beam, Inc., a major U.S. liquor producer, up to 46.5% of the Federal tax grants on its rum. Puerto Rico’s last Governor, Luis Fortuno (statehood), opposed the U.S. Virgin Islands subsidies, fearing a “race to the bottom” for territorial treasuries. But when lobbying by the Podesta Group for Diageo, Beam, and the U.S. Virgin Islands delayed passage of legislation to limit subsidies, Fortuno reluctantly agreed to subsidies of up to 46.5% for Puerto Rico’s remaining rum producers to enable them to compete with the Virgin Islands producers, including Diageo. Fortuno continued to work for a Federal limitation on the subsidies, however. In Puerto Rico, the locally owned Serralles distillery produced Captain Morgan for Diageo. It became the second-highest selling rum produced in Puerto Rico. The loss of the production contract was a major blow to the distillery and the Ponce, Puerto Rico community in which it is located. Puerto Rico’s government has not only lost the grants of Federal taxes on Diageo rum, it has lost a share of the grants of Federal taxes on foreign rum based on Diageo’s production. In addition, it has had to increase its spending benefitting its remaining rum producers, Bacardi, Serralles, and others, from six to as much as 46.5% of the Federal tax grants. The total lost to public services in the territory runs easily exceeds $100 million a year. The administration of new Puerto Rico Governor Alejandro Garcia Padilla (‘commonwealth’ party) has said that it will not try to limit the subsidies at the Federal or territorial level. It has not explained the decision but it has hired a major lobbyist for the subsidies to represent the Government of Puerto Rico as well as represent Diageo. Meanwhile, some people in the States have suggesting ending the grants or, at least, the temporary higher amount of grants because so much of the money is going to subsidize profitable private companies instead of public services in the territories. Ending the grants would save the Federal treasury about a half of a billion dollars a year, helping to bring the Federal budget — plagued by an excessive deficit — a step closer to balance.
Posted on: Tue, 30 Jul 2013 21:42:41 +0000
Trending Topics
Recently Viewed Topics
© 2015