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Puerto Rico: standard rate: 11.5% other applicable rates: 7% 4% 10.5% solo IVU estatal 1% solo IVU municipal
The IVU calculator calculates Puerto Rico Sales and Use Tax and the price before and after tax. Select the rate applicable to your transaction. The 7% and 4% rates have specific eligibility rules and do not generally replace the 11.5% rate. You can also make a currency conversion.
You can also select the IVU rate by clicking a percentage in the table below.
Puerto Rico | |
| standard rate | 11.5% The general IVU rate is 11.5%, consisting of 10.5% state IVU and 1% municipal IVU. It applies to most sales of tangible personal property, taxable services and admission rights unless an exemption or special rate applies. |
| other applicable rates | 7% Reduced rate for prepared food, carbonated beverages, bakery products and candy sold by a restaurant or other business holding the required Authorised Business certificate. The rate consists of 6% state IVU and 1% municipal IVU. Alcoholic beverages remain subject to 11.5%. Special rules also apply to combined transactions and products acquired pre-packaged for resale. 4% Special state IVU applying to designated professional services and specified services supplied to other merchants where an exemption does not apply. The 1% municipal IVU is not added. Not all business-to-business services are taxed at 4%: specified services classified as taxable services remain subject to 11.5%. 10.5% solo IVU estatal State IVU where a transaction is subject to state tax but exempt from the 1% municipal IVU. This may apply, for example, to imports of inventory for resale covered by a valid Reseller and Municipal IVU Exemption Certificate. Where municipal tax also applies, the combined rate is 11.5%. 1% solo IVU municipal Municipal IVU on food and food ingredients meeting the statutory definition and exempt from state IVU, unless another exemption applies. This is not the general rate for prepared food. |
| IVU-exempt | Exemptions cover prescription medicines and specified medical products; certain education, healthcare, insurance and financial services; qualifying rentals, government transactions and exported services. Tax-free periods also apply to specified school and hurricane-preparedness items. The relevant conditions and certificate requirements apply. Food and food ingredients meeting the statutory definition are exempt from state IVU but generally subject to 1% municipal IVU unless another exemption applies. |
| outside the scope of IVU | Items excluded from the definition of tangible personal property for IVU purposes include money and specified securities and intangibles; automobiles, motorcycles, boats, heavy equipment, buses, trucks and specified trailers; gasoline, aviation fuel, diesel, crude oil and specified petroleum products; electricity; and water supplied as part of the ordinary water and sewer service. Some of these items may instead be subject to excise or other taxes. |
| self-assessment and use tax | When a person located in Puerto Rico receives from a nonresident a service directly or indirectly related to its Puerto Rico operations or activities, the recipient may be responsible for self-assessing and remitting IVU. In addition, tangible personal property brought into Puerto Rico for use, consumption or storage can give rise to use tax where sales tax was not collected. |
| used goods and trade-ins | Puerto Rico does not have a general VAT-style margin scheme for resales of second-hand goods. In a trade-in transaction, the value assigned to the used item accepted by the merchant can reduce the selling price of the new taxable item. If the merchant subsequently resells the used item, however, IVU is calculated on the full resale price rather than on the difference between the resale price and the value or cost of the item. The ordinary VAT margin calculator is therefore not applicable to Puerto Rico. |
| registration, thresholds and resellers | Registration A person carrying on or intending to carry on business in Puerto Rico as a merchant must register in the Merchant Registry. There is therefore no single general registration threshold for businesses established in Puerto Rico. Turnover exemptions For ordinary taxable services, the annual $50,000 threshold continues to apply to the relevant service exemption. Since 1 March 2019, designated professional services and specified services supplied to other merchants by persons whose annual business volume does not exceed $200,000 are exempt from IVU. These are collection exemptions, not a general Merchant Registry threshold. Merchants without a physical presence Economic-nexus rules can apply to a merchant or marketplace facilitator without a physical Puerto Rico location where Puerto Rico gross sales exceed $100,000 or at least 200 transactions are made during the applicable annual period. Marketplace facilitators covered by the rules collect and remit IVU on covered marketplace transactions. Resellers IVU does not provide a general VAT-style input tax credit. A properly registered reseller holding the required certificate may claim the permitted credit for IVU paid on tangible personal property purchased or imported for resale. Specified eligible resellers can acquire merchandise for resale under the applicable exemption rules. The special 4% IVU paid on services does not form part of the reseller credit. |
Puerto Rico's IVU is a sales and use tax, not a value added tax. The calculator can perform the arithmetic using the selected rate, but it does not determine exemptions, certificates, reseller credits, economic nexus, filing obligations or the administrative allocation of municipal IVU.
| Past changes: | |
| 1 Aug 2026 | Integrated filing and payment of municipal IVU through SURI becomes operational for the 73 participating municipalities, initially for the July 2026 period. Bayamón, Carolina, Guaynabo, Mayagüez and San Juan continue using their own processes. IVU rates are unchanged. Puerto Rico Department of Treasury – CC RI 26-13 |
| 1 Oct 2019 | Authorised restaurants and other qualifying businesses may apply the reduced 7% rate instead of 11.5% to specified prepared food, carbonated beverages, bakery products and candy. Alcoholic beverages remain at 11.5%. Puerto Rico Department of Treasury – DA 19-03 |
| 1 Mar 2019 | Designated professional services and specified services supplied to other merchants become IVU-exempt where the provider's annual business volume does not exceed $200,000. Ordinary taxable services retain the $50,000 threshold. Puerto Rico Department of Treasury – CC RI 19-05 |
| 1 Aug 2017 | Hacienda begins collecting the 1% municipal use-tax portion on tangible personal property brought into Puerto Rico from outside for use or consumption. Puerto Rico Department of Treasury – DA 17-04 |
| 1 Oct 2015 | The special 4% state IVU takes effect for designated professional services and specified services supplied to other merchants. Municipal IVU is not added. Puerto Rico Department of Treasury – DA 15-17 |
| 1 Jul 2015 | The state IVU rate rises from 6% to 10.5%. The municipal portion remains 1%, increasing the combined rate to 11.5%. Puerto Rico Department of Treasury – DA 15-10 |
Note: the IVU information on this page is general information, not tax advice. It does not cover every exemption, requirement or special situation. Check the treatment of your transaction in the rules and guidance of the Puerto Rico Department of Treasury. Information checked 1 Oct 2026.
VAT rounding: the EU, the UK and other European countries
The EU VAT Directive and the Court of Justice of the European Union leave VAT rounding rules to be decided at national level. National rules vary. In the UK, HMRC allows VAT on B2B invoices to be rounded down to the nearest whole penny.
Roundings in VAT calculation: Mathematically impossible prices?
There are a whole range of VAT-inclusive prices that cannot be mathematically arrived at if the tax is calculated from the VAT-free price. One example is 3.99. These prices are also possible, but then the VAT-free price must be interpreted as rounded.
VAT Gap - How much VAT is left uncollected in EU countries?
9.5% of VAT was left uncollected in EU countries. See the list of EU countries and candidate countries.
In Europe there is VAT - in the US sales tax
In Europe, companies belonging to the production chain account for the VAT paid by the consumer to the state in proportion to their value added. The US sales tax, on the other hand, is billed entirely by the company that made the consumer sale. Sales tax is paid to local operators, not to the state.
Many of today's taxes were already in use in Antiquity. Deciding on taxation has moved from autocrats to parliaments and the level of taxation has risen. In earlier times taxes were used to wage wars, today taxes are used to maintain welfare states.
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