Puerto Rico's Fiscal Oversight Board (JSF) criticized the Legislative Assembly's approval of the island's tax reform for threatening to reduce local government revenues by $3 billion over the next five years.
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The fiscal entity's reproach comes after the Legislature approved last Tuesday House Bill 1839 Substitute, for which it now awaits the signature of Puerto Rico Governor Pedro Pierluisi.
"The Oversight Board urges the Legislature not to send the bill to the governor for his signature, and likewise urges the governor not to sign it into law," the Board requested in a press release.
"Instead, we encourage both branches of government to meet with the Oversight Board to work together on a budget that adequately funds services, and on a fiscal reform plan that is affordable and leads to long-term economic growth for a recovering Puerto Rico," it emphasized.
The tweet reads, "The tax reform approved by the PR Legislature would reduce Gov't revenues by about $750M this fiscal year and almost $3,000M in 5 years. Losses would lead Gov. back to deficit and spending practices that led to bankruptcy and the creation of the JSAF."
According to the Board, the new tax reform would also reduce the island's government revenues by about $750 million this fiscal year.
"The bill threatens the Government's fiscal stability. With these substantial revenue losses, the Government's budget would fall back into deficit; thus erasing the progress made in recent years to stabilize Puerto Rico's finances," the entity said.