Puerto Rico’s Supreme Court ruled that every tax dispute on the island must be heard by a specialized courtroom in the San Juan Judicial Region. The ruling, in opinion 2026 TSPR 101, came in the lawsuit by Beta Electric Corp. against the Gurabo town government. The court said it was an opportunity to "hacer valer la intención de la Asamblea Legislativa" (enforce the Legislature’s intent) in creating the specialized courtroom through Act 123-2016.
Per the court’s summary, the Puerto Rico Electric Power Authority (PREPA (AEE), or PREPA) hired Beta to repair power lines in several towns, including Gurabo, which demanded $68,225 in municipal excise taxes. Beta argued it was entitled to a tax exemption and sued for a declaratory judgment. Gurabo was slow to appear, so a default was entered, but it later appeared and asked that the default be lifted and the case moved to the tax courtroom.
The Court of First Instance sided with Gurabo; the Court of Appeals reversed. The Supreme Court distinguished jurisdiction from venue-type competence, noting that a case filed in the wrong courtroom should not be dismissed and that courts must transfer it on their own motion. It said Act 123-2016 created the Specialized Courtroom for Tax Matters and Economic Crimes because such cases require specialized expertise, and that it would give taxpayers more certainty of uniform application.
Towns lack inherent power to impose taxes, the court said. Although the Municipal Code is not on the law’s list of statutes, the list is non-exclusive and allows others to be included.