Vacationing on a Tax Haven : Law, Visitor Economy, and Offshore Finance in Puerto Rico

Puerto Rico has recently emerged as one of the fastest-growing tourist destinations in the Caribbean, a shift accelerated during the COVID-19 pandemic and promoted by the local government as a response to prolonged economic crisis, austerity, and socioenvironmental disasters. This article argues that Puerto Rico’s recent expansion of tourism is a legal extension of its offshore financial diversification project. It examines how tax incentives and credits, regulatory waivers, and investment laws, most notably the Puerto Rico Incentives Code (Act 60 of 2019), have integrated tourism and luxury real estate into the archipelago’s broader transformation from a corporate tax haven into an offshore financial center. Drawing on sociolegal and political economy scholarship, the article shows how tourism and offshore finance are legally and institutionally entangled, constituting a colonial offshore economy : a legal–fiscal framework that facilitates capital mobility, regulatory arbitrage, and speculative investment. Empirically, it combines legal analysis with two case studies of luxury tourism megaprojects, Moncayo in Fajardo and Esencia in Cabo Rojo, to demonstrate how the colonial offshore economy materializes through tourism development, restructuring land use, redistributing public resources, and intensifying legally mediated forms of displacement and socioenvironmental harm.