Editing Government of Puerto Rico (section)

===Central government revenues===
{{Further|Taxation in Puerto Rico}}

The central government's main source of revenue is income tax imposed on individual citizens and private companies, which can amount to approximately $5.5 billion.<ref name="PR_2005_budget"/> Other significant sources of revenue include excise taxes on imports, cigarettes, liquor, hotel rooms, cement, and vehicles ($2 billion);<ref name="PR_2005_budget"/> and lotteries ($870 million).<ref name="PR_2005_proprietary">[http://www.hacienda.gobierno.pr/downloads/pdf/cafr/FINANCIAL_REPORT_2005.pdf Commonwealth of Puerto Rico 2005 Comprehensive Annual Financial Report] for the fiscal year ended on June 30, 2005; pg. 32; Statement of Revenues, Expenses, and Changes in Net Assets-Proprietary Funds</ref>

====Sales and Use Tax====
{{Main article|Puerto Rico Sales and Use Tax|Puerto Rico Sales Tax Financing Corporation}}

On November 15, 2006, the government eliminated the excise tax of 6.6% on imports (taxes on cigarettes, liquor, and cars are still in effect) and substituted it for a 5.5% islandwide [[Puerto Rico Sales and Use Tax|Sales and Use Tax]], plus a municipal sales tax of 1.5%, for a total of 7%, in what has been known as the [[Puerto Rico Tax Reform]].<ref>{{cite news |author= Miguel Díaz Román |title= Incierto el impacto del nuevo tributo|url=http://www.endi.com/noticia/portada/noticias/incierto_el_impacto_del_nuevo_tributo/110378 |newspaper=[[El Nuevo Día]] |date=2006-11-15 |access-date=2006-11-15|language= es}}</ref> This change was partly due to the government's growing expenditures and fiscal deficits which remained unchecked and uncorrected for several years, until several [[credit agency|credit agencies]] warned public officials that all general-obligation [[Bond (finance)|bonds]] issued by the government were to be downgraded if the problem was not corrected.<ref name="Rodríguez">{{cite news|first=Magdalys |last=Rodríguez |url=http://www.endi.com/2006/05/01/index/412858.asp?category=Ultima+hora&title=No+hubo+acuerdo+y+el+gobierno+amanecio+cerrado&artdate=2006/05/01 |title=No hubo acuerdo y el gobierno amaneció cerrado |newspaper=[[El Nuevo Día]] |access-date=2006-05-01 |language=es }}{{dead link|date=May 2017|bot=medic}}{{cbignore|bot=medic}}</ref>

The situation reached a turning point when the executive branch of the government was partially shutdown, the events now known as the [[2006 Puerto Rico budget crisis]]. Thirty-three (33) agencies were closed and 95,762 employees were sent home without pay. Following public bickering between the two main political parties, the new sales tax was approved in favor of the excise tax on imports on May 10, 2006, ending the budget crisis.<ref name="Rodríguez"/>