[Congressional Record Volume 142, Number 124 (Wednesday, September 11, 1996)]
[Senate]
[Page S10343]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         ADDITIONAL STATEMENTS

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               REGARDING PUERTO RICO ECONOMIC INCENTIVES

 Mr. D'AMATO. Mr. President, I have said in the past, and 
continue to believe, that the action taken by Congress in eliminating 
section 936 without a permanent replacement program that provides a 
major stimulus to economic development in Puerto Rico and the creation 
of well-paying and stable jobs was unfortunate.
  We have the seeds of a replacement program in new Internal Revenue 
Code section 30A that provides a targeted wage credit to companies 
currently doing business in Puerto Rico based upon the compensation 
paid to their qualified employees. Although this is certainly movement 
in the right direction, it does not allow new business starts, and the 
credit will sunset in 10 years. As such, it does not provide the 
permanency that is needed to maintain the economic development of 
Puerto Rico, and will adversely impact States like New York.
  Corporations headquartered in New York State that have invested in 
Puerto Rico employ over 39,000 persons in New York. Moreover, Puerto 
Rican subsidiaries of mainland companies purchase approximately $195 
million per year worth of supplies and services from New York. 
Consequently, when the wage credit sunsets in 2006 and corporations are 
drawn to other regions where there are tax incentives, New York State 
will lose not only jobs, but a significant amount of income from goods 
and services.
  Mr. President, Congress needs to work with the elected 
representatives of Puerto Rico to expand section 30A into a dynamic and 
effective job creation incentive that helps to bring new and high-
paying jobs to Puerto Rico. By doing so, we will raise Puerto Rico's 
economic standards and provide efficient Federal incentives to 
accomplish those goals. I firmly believe that Congress, working with 
Governor Rossello and other elected leaders from Puerto Rico, can 
successfully fashion a program that achieves economic progress for 
Puerto Rico and efficiency in Federal expenditures.

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