Author Topic: business/economic climate  (Read 1565 times)

Chiquito

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business/economic climate
« on: June 09, 2015, 11:14:25 PM »
Hi Jay and all,
Since we are looking to start a business in the San Juan area, I was wondering if anyone had any responses to the articles linked below. I would have posted a comment in the business section but there isn't one. Jay, maybe we should start a dedicated thread for all of this stuff? (Industry, banking, real estate etc)
http://www.kqed.org/news/story/2015/05/05/162207/in_puerto_ricos_debt_crisis_there_are_no_easy_solutions

http://www.kqed.org/news/story/2015/06/05/164332/broke_and_barred_from_bankruptcy_puerto_rico_seeks_outside_cash?category=u.s.

This is half politics I know but it affects the entrepreneurial climate quite a bit.
Thoughts?
-j

NewToPuertoRico

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Re: business/economic climate
« Reply #1 on: June 10, 2015, 06:33:04 PM »
Hello!

Yeah that's a good idea! I can add a category for local businesses! Thank you for the suggestion! This is a work in progress so your help will make this growing
community better!

I have not seen those news articles before but the economy is a very hot topic here! Like you said, half of it is political, any comment that I put here may be perceived as political as well, so I will try to not seem that way because I am not. I simply say it as it is.

I honestly do not know what all contributed to the economic crisis that is going on here. There are many things that contributed I'm sure. Some people blame the Cabotage Laws the US has on Puerto Rico, others blame our colony status and the inability for PR to file for bankruptcy (only states can and we are not a state). I really don't know what all caused this.

But what I do know is that politics are really getting in the way. The current governor is trying everything he can come up with to find what he thinks would be a solution. Agree with him or not, the only thing that he is saying is that we cannot solve the current financial problem by doing the same thing, so he's coming up with new ways to try and tackle the problem, some agree, others don't. An example was the tax reform. He wanted to change the regular sales tax (IVU) to a value aggregated tax (IVA) which is what many other countries do. There are pros and cons to the IVA and honestly I am no expert to decide if one is better than the other.

However, the real reason why we have been having so much trouble with this is simply because no one can agree with the other so nothing gets done. You see these "caucus decisions" taking over. This means that if you have 20 people of an opposing political party to the governor's, you better vote against what he's proposing because if the caucus decides to vote against it and you vote for it, you will get kicked out of the party, and it happened with one representative of the PNP party not too long ago. So, the frustration of many people here is that the politicians are working for their fellow politicians and friends rather than working for the people who voted them in. And as long as no one can agree, nothing will get done. People really didn't know if the IVA would've worked, but it was a change from what we had and some people wanted to at least try it before making a decision.

So this situation is not easy, and politicians are certainly not making it better. Now instead of the IVA tax which would have exempted income tax up to $80k for married couples, we now have a temporary sales tax of 11.5% starting in July with no income tax exemption.

Having said this, I really do not keep track of the politics themselves, I don't even have cable TV or an Antenna. So I only see from the sidelines "without commentators". I don't really know what is going on, what I do know is that no one is agreeing to anything and the big reason is simply because they are from the other political party.

Again, I am not a political person, I don't really follow politics and I have no affiliation with any political parties whatsoever. All I know is that no one is getting along and no one wants to be the next person to be kicked out from their respective caucus, so they vote for or against proposals based on political party whether they as individuals agree with it or not.

I will add a business section to the forum.