The Puerto Rico Sales Tax Financing Corporation, better known by its Spanish acronym COFINA, is a subsidiary of the Government Development Bank and an independent governmental instrumentality of the Government of Puerto Rico. The Corporation receives half of the Government Sales and Use Tax (SUT) (2.75% out of the Central Government’s sales tax of 5.5%) and is authorized to use such portion of the SUT to pay or finance, in whole or in part, or fund: (i) certain debt obligations of the Commonwealth payable solely from Commonwealth budgetary appropriations and outstanding as of June 30, 2006; (ii) the debt of the Secretary of the Treasury of Puerto Rico with the Government Development Bank; and others. Note that the SUT of 7% is distributed between the General Fund (5.5%) and the municipalities (1.5%).
As of May 2011 COFINA has issued over $14.4 billion in bonds pursuant to its Enabling Act, as amended, of which $13.4 billion are outstanding.
As an independent corporation, COFINA has the same powers, rights and faculties as the GDB under its Constitutional Charter.
For more information on COFINA as a tax-exempt securities issuer click HERE.