Puerto Rico Debt Slides Amid Wrangling on Tax Plan to Raise Cash
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Yields on Puerto Rico’s newest general obligations are setting record highs as lawmakers struggle to resolve a debate on tax changes that would pave the way for a $2.9 billion bond sale needed to ease a cash crunch.
With about two months left in the fiscal year, the island’s House of Representatives isn’t ready to vote on a plan to revamp the levy on goods and services in the junk-rated U.S. territory. As lawmakers wrangle with the details, yields on tax-exempt Puerto Rico general obligations maturing in July 2035 traded Tuesday with an average yield of 10.36 percent, according to data compiled by Bloomberg. The yield reached 10.42 percent last week, the highest since the bonds’ sale in March 2014.