Manufacturing Benefits Under Act 60: Your Complete 2025 Guide

CRITICAL 2025 UPDATE: With Act 60's extension through 2055 and updated Incentive Code, manufacturing companies face new SME support programs and special marketing activity incentives. Existing beneficiaries maintain grandfathered protection while new post-2026 applicants operate under a 4% corporate rate structure.

Puerto Rico has consolidated as one of the most attractive manufacturing destinations in the Western Hemisphere, and Act 60 Chapter 4 offers extraordinary incentives that can transform your industrial operation's profitability.

This guide explains all available benefits, specific requirements, and strategies to maximize your manufacturing incentives in Puerto Rico.

Why Puerto Rico Is a Manufacturing Paradise

Unique Strategic Advantages

Geographic Location:

World-Class Infrastructure:

Regulatory Advantages:

Established Manufacturing Ecosystem

Dominant Sectors:

Developed Supply Chain:

Chapter 4: Detailed Manufacturing Incentives

Principal Benefit: 4% Industrial Rate

The star incentive:

International comparison:

Powerful Additional Incentives

Municipal License Exemption (75%)

Import Duty Exemption (100%)

R&D Incentives (50% credit)

Construction Excise Tax Exemption

Distribution Benefits

Profit Distribution (0% withholding)

Requirements and Eligibility

Basic Eligibility Criteria

Eligible Activities:

Minimum Investment:

Employment Requirements:

Operational Commitments

Economic Substance:

Environmental Compliance:

Reporting and Transparency:

ROI Analysis by Sector

Pharmaceutical Sector

Typical company:

Quantified benefits:

Payback period: 1.4 years in tax savings alone

Medical Device Sector

Typical company:

Quantified benefits:

ROI: 80% return on initial investment annually

Electronics Sector

Typical company:

Quantified benefits:

Break-even: 12 months including all setup costs

Specialized Application Process

Phase 1: Feasibility Study (8-12 weeks)

Market Analysis:

Technical Assessment:

Financial Modeling:

Phase 2: Site Selection and Setup (12-16 weeks)

Location Options:

Infrastructure Development:

Phase 3: Decree Application (16-20 weeks)

Documentation Package:

DDEC Review Process:

Phase 4: Implementation (6-12 months)

Facility Construction/Setup:

Team Building:

Advanced Optimization Strategies

Maximizing R&D Benefits

Structured R&D Programs:

Qualifying Expenses:

Best Practices:

Supply Chain Optimization

Local Sourcing Incentives:

Import Optimization:

Workforce Development Strategies

Talent Pipeline Creation:

Competitive Compensation:

Costly Mistakes to Avoid

Mistake #1: Underestimating Compliance Requirements

Problem: Inadequate environmental or safety compliance
Result: Delays, fines, potential decree revocation
Solution: Invest heavily in compliance from day one

Mistake #2: Insufficient Local Integration

Problem: Operating as isolated entity
Result: Missed opportunities, community resistance
Solution: Active community engagement and local partnerships

Mistake #3: Underestimating Infrastructure Needs

Problem: Inadequate power, water, or transportation
Result: Production delays, increased costs
Solution: Thorough infrastructure assessment upfront

Mistake #4: Poor Talent Strategy

Problem: Difficulty recruiting or retaining skilled workers
Result: Production issues, increased costs
Solution: Comprehensive talent development strategy

Real Success Stories

Case Study 1: Pharmaceutical Giant Expansion

Company: Major US pharmaceutical company
Investment: $120M USD facility expansion
Products: Oncology medications

Results after 3 years:

Key success factors:

Case Study 2: Medical Device Innovation Hub

Company: European medical device manufacturer
Investment: $60M USD greenfield operation
Products: Cardiac implant devices

Results after 2 years:

Innovation highlights:

Case Study 3: Electronics Manufacturing Hub

Company: Asian electronics conglomerate
Investment: $85M USD manufacturing complex
Products: Automotive semiconductors

Results after 18 months:

Strategic advantages:

Future of Manufacturing in Puerto Rico

Emerging Opportunities (2025-2030)

Industry 4.0 Integration:

Green Manufacturing:

Biotechnology Expansion:

Government Support Initiatives

Infrastructure Investments:

Workforce Development:

Regulatory Improvements:

How Virtus Advisory Accelerates Your Success

Manufacturing Specialization

Industry Expertise:

End-to-End Support:

Unique Value Propositions

Integrated Service Approach:

Proven Track Record:

Specialized Services

Technical Due Diligence:

Implementation Support:

Conclusion: Your Manufacturing Future in Puerto Rico

Puerto Rico under Act 60 offers a unique combination of tax incentives, developed infrastructure, and strategic advantages that can transform your manufacturing operation. The benefits go far beyond tax savings—they include market access, skilled workforce, and support ecosystem.

Key takeaways:

Your decision factors:

Remember: Manufacturing success in Puerto Rico requires more than just filing papers—it requires strategic thinking, proper implementation, and long-term commitment to the community.

Start Your Manufacturing Journey

Ready to explore manufacturing opportunities in Puerto Rico? Need expert guidance to evaluate feasibility and maximize benefits?

Our Manufacturing Consulting includes:
✅ Comprehensive feasibility analysis
✅ Site selection and infrastructure planning
✅ Decree application and approval process
✅ Implementation support and project management
✅ Ongoing compliance and optimization

Don't navigate this complex process alone. Let our manufacturing specialists guide you to success.

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*Interested in manufacturing opportunities under Act 60? Our team has facilitated $2B+ USD in manufacturing investment and can help you evaluate and execute your Puerto Rico strategy.*