82.1 F
Charlotte Amalie
Sunday, July 21, 2024
HomeNewsArchivesRum Tax Rebate Explained

Rum Tax Rebate Explained

Dear Source:
"The federal government returns to the territorial government $13.25 for each proof gallon of rum produced in the territory and sold in the United States. Rum buyers pay $13.50 in federal taxes."
Nope. The federal government covers-over (gives) $13.25 for every proof gallon of rum products imported by the United States from anywhere in the world to the treasuries of Puerto Rico and the Virgin Islands. Currently, about 14 percent of the total cover over goes to the VI and 86 percent to Puerto Rico. The formula is based on the percentage of the total amount of rum shipped to the US from the two territories. Since the new distillery will double the amount shipped from the VI and cut the amount shipped by PR (as a percentage of worldwide rum import taxes), the VI will increase its share to more than 40 percent. It is not a refund of anything. Please see Section 26.31 of the United States Code 7652.

Bob Hoffman
Christiansted, St.Croix

Editor's note: We welcome and encourage readers to keep the dialogue going by responding to Source commentary. Letters should be e-mailed with name and place of residence to visource@gmail.com.

Print Friendly, PDF & Email
Keeping our community informed is our top priority.
If you have a news tip to share, please call or text us at 340-228-8784.

Support local + independent journalism in the U.S. Virgin Islands

Unlike many news organizations, we haven't put up a paywall – we want to keep our journalism as accessible as we can. Our independent journalism costs time, money and hard work to keep you informed, but we do it because we believe that it matters. We know that informed communities are empowered ones. If you appreciate our reporting and want to help make our future more secure, please consider donating.

Previous article
Next article