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/ Wednesday, April 13, 2022
Without Act 60, Investing in Puerto Rico is Still Worth It
Singaporean firm opens a branch on the island
O
Zoe Landi Fontana, The Weekly Journal
At the end of the day, we find that the most sustainable way forward is first to create value for the people here.
@Landi_Zoe
utside investing on the island is practically synonymous with Acts 20 and 22, combined under Law 60 of the Puerto Rico Incentives Code Act. The incentives create an environment of minimal taxation - something that supporters believe will encourage economic growth for the island’s entire population. But does a 4% tax rate, not to mention 0% on capital gains, really attract companies that will create significant and long-lasting change by merely creating a few jobs?
Ravi Kumar Investment professional
bit better. And also, now I see a lot of ways that Puerto Rico can learn from what Singapore has done,” said Kumar. Puerto Rico, Kumar explained, is much like Singapore in that it’s an entry-point, “We see it as an entryway into Latin America while enjoying that stability, or the U.S. recognition, that comes with it.”
A Foreigner In The Market
Opting Out Of Act 60
Ravi Kumar is an investment professional from Singapore with a diverse portfolio of businesses: Launchpad, a global private equity firm; Nought Labs, a global strategy firm, and The 5th Floor, a global coworking brand. He recently opened a branch of The 5th Floor in Puerto Rico. In conversation with THE WEEKLY JOURNAL, Kumar explained his decision to invest in Puerto Rico without opting into the tax incentives that attract so many others. “At the end of the day, we find that the most sustainable way forward is first to create value for the people here. And that really sets us up for long-term growth. Trying to take advantage of the extra money, I think that that isn’t so well with us, you know, with the philosophy of creating value,” Kumar expressed on the topic of Act 60. “We’ve always been in a position where, let’s see how we can first help. And then you know, we can talk about the rest down the line”. Puerto Rico and Singapore may seem like they have very little in common, but they have much to learn from each other. “I come from Singapore. [There are] a lot of
Ravi Kumar, partner at investment firm Launchpad. >LinkedIn
similarities between Puerto Rico and Singapore like both are island states. And here’s a fun fact - Singapore is a copy of Puerto Rico’s blueprint forty years ago. Somehow Singapore just did it a
As a foreigner, Kumar is looking to learn a lot before deciding where to take his next steps. “[Because] we’re relatively new in the market we try to learn as much as possible - what’s going on on the ground, ready for partnerships with entities that have already been here that are wellpositioned. [And] now we’re also trying to talk to the Chamber of Commerce. [Whenever] there’s a foreigner coming in, there’s sometimes a bit of resistance, you know, being a foreigner, so we just want to learn at this point,” he said of his current situation on the island. From what he’s seen so far, Kumar believes there is a lot to bet on in Puerto Rico. “So the way forward is, right now [Puerto Rico] is very reliant on the government to help people out. But I think this is a good opportunity for both public and private to come together and see how we can work together. Because you cannot entirely rely on the government, we all know, like, the government can be very cautious and a lot slower implementing things, whereas the private sector, they’re a lot more agile. I think there needs to be a meeting of the minds on this too,” he described the relationship between sectors.
