JH: Originally, it was a tax advantage. That went away a few years ago. Now the reason they stay is a very experienced and highly productive workforce as well as an infrastructure of supporting companies.
HCP: Can you elaborate on the tax advantages?
JH: It used to be that under Section 936 of the internal revenue code, companies with operations in Puerto Rico paid minimal or no federal taxes on Puerto Rico profits. This went away with a revision of the tax code in the 1990s. I believe that the last of these tax exemptions expires this year.