If you purchase something in Puerto Rico you might find something peculiar in your receipt. Printed in the receipt on many merchants you might find something like:
IVU LOTO: XBSA1-GOSH1 DRAW: May-30-2011
This means that you are automatically participating in a raffle without probably knowing it! You see, ever since Puerto Rico implemented a sales tax, many merchants have not been fully honest sending the tax revenue to the Puerto Rico Treasury- but they still charge and pocket the 7% sales or IVU tax for themselves. Estimates vary but it is believed that the tax evasion is around 60% (likely more). So in order to ensure that the merchants are paying their dues to the state a new law has come into effect which turns citizens into IRS agents. Here is how:
- All merchants must register to participate on the IVU Loto Program.
- Merchants who qualify for the program are outfitted with devices on their cash register machines. For most merchants it is fairly straightforward if they have credit card terminals. The terminals have been reprogrammed to issue out IVU Loto codes when they print out their receipt.
- Merchants must use these devices/terminals to report the sales taxes collected upon a purchase transaction and yes, even cash transactions. The devices record the transaction amounts and report it to the Treasury Department in real time.
- Merchant must hand over a receipt, failure to do will result in a fine on the merchant. A lottery number will be printed on the receipt.
- Every other day the Treasury Department will pick some of the IVU Loto codes at random and give away prices.
- If a merchant refuses to give a consumer a receipt the consumer can report them to the Treasury Department.
This is quite novel approach to tax collection enforcement, but it has stirred up some controversy. Already local religious groups are claiming that this is forcing gambling upon the people. As you can imagine, merchants aren’t too happy either. Some merchants are claiming that coming “clean” will force them out of business or raise prices. Consumers aren’t too sure on to know if they have a winning ticket/receipt. Who knows what is next? Las Vegas style slots on soda vending machines?
Here are a few helpful links:
- Puerto Rico Department of the Treasury – IVU Loto Page
- IVUSpots.com – A website for consumers to record and organize their IVU Loto receipts from a PC or Smartphone. If you have a winning number you get an email alert.