Puerto Rico Legislators to Debate Oil Tax Increase

Puerto Rico's governor on Friday called a special legislative session for next week to debate a measure that seeks to boost an oil tax by 68 percent.

Gov. Alejandro Garcia Padilla said legislators will meet starting Monday as part of a session that can legally be extended for up to 20 days.

The measure aims to help sell up to $2.9 billion in bonds and strengthen the debt-ridden Highway and Transportation Authority. If approved, the U.S. territory's excise tax on a barrel of crude oil would increase from $9.25 to $15.50 and generate $178 million a year.

Supporters have said the increase would not affect the price of electricity on an island where power bills on average are more than twice those on the U.S. mainland.

The measure comes as the island struggles with $73 billion in public debt amid concerns that public agencies might declare bankruptcy.

Moody's has previously warned that the Government Development Bank's liquidity could fall as much as 22 percent if there was no new bond offering to refinance the Highway and Transportation Authority's debt.

Puerto Rico Legislators to Debate Oil Tax Increase