The situation in Puerto Rico just gets stranger.
The latest news is that some leaders of the Commonwealth’s labor movement asked the legislature (on Friday) to amend Law 154 and impose a fixed tax of between seven to ten percent on foreign companies doing business on the island .
(Law 154 imposes a special tax of four per cent on non-resident companies. That means all of the “Big Pharma” firms doing business on the island. It was enacted minus any public input or comment.)
The head of the Workers Federation of Puerto Rico, and representatives of the Puerto Rico Central Workers Union and the Brotherhood of Ports Authority Workers claim that a permanent 7 percent corporate tax provide the funds to hire back some of the 20,000 public employees fired due to the island’s economic malaise.
To put that into immediate perspective -- According to a 2006 survey, the biopharma sector supports over 94,000 jobs in Puerto Rico. Talk about fuzzy math. Put 94,000 private sector jobs at risk to rehire 20,000 government workers? What’s wrong with this picture?
Surprising for many reasons, not the least of which is the recent commitment to the Molecular Sciences Center, the BioProcess Training and Development Center, and the Puerto Rico Cancer Center -- part of a larger effort by Puerto Rico to attract research and development in the life sciences. Raise taxes to increase corporate investment? Where’s that economic theory being taught? Faber College?
As Patrician Van Arnum wrote in Pharmaceutical Technology, “Puerto Rico competes with other established areas for pharmaceutical manufacturing investment such as Singapore and Ireland. And China and India, although still emerging areas for pharmaceutical investment, are a consideration for future development.”
Someone should mention this to Governor Luis Fortuño.
