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Charlotte Amalie
Thursday, June 20, 2024
HomeNewsLocal newsFinance Committee OKs Tax Amnesty to Provide COVID Relief

Finance Committee OKs Tax Amnesty to Provide COVID Relief

Sen. Donna Frett-Gregory speaks in favor of her tax amnesty bill during Friday’s meeting of the Senate Finance Committee. (Photo provided by the V.I. Legislature)

The Senate Finance Committee on Friday unanimously passed a tax-amnesty bill to help Virgin Islander face difficult financial times brought on by the COVID-19 pandemic.

Should the bill become law, it would grant relief from penalties and payments on outstanding income taxes, and relief from interest, penalties and payments on outstanding gross receipt taxes and real property taxes until June 30, 2021. While taxes would still be due, the legislation allows taxpayers to pay delinquent taxes without accruing interest or penalties.

“This bill came from the urging of our community,” said Sen. Donna Frett-Gregory, who proposed the bill. “We know the situation we are in as it relates to the pandemic. We know what our small businesses have experienced as a result of this pandemic … It’s our responsibility to take care of our businesses here in the Virgin Islands and the people here who have homes and who have lost their jobs.”

Brent Leerdam, territorial tax collector in the Real Property Tax Division of the Office of the Lieutenant Governor, said the legislation was in line with what Lt. Gov. Tregenza Roach has already done.

“Lt. Gov. Roach established a relief program to waive application and collection of all real property tax interest and penalty,” Leerdam said.

When requested, Leerdam said, the Office of the Lieutenant Governor routinely waives interest and penalties for taxpayers based on their individual circumstances.

“In light of the unprecedented negative economic effects of the coronavirus on the territory, however, Lt. Gov. Roach reasonably and prudently decided to extend the waiver to all taxpayers automatically. The automatic waiver extends to all delinquent tax accounts and terminates on the date that the 2021 tax bill is issued,” Leerdam said.

While the current program applies to real property tax, the amnesty provided in the bill also would apply to income taxes and gross receipts taxes.

Several committee members said they do not typically support tax amnesties, but the year 2020 has caused them to change their views.

“At one point I did say that I don’t know if I am going to support any more tax amnesties, but we are not in normal times. For the last three years it has been up and down. After the hurricane it left devastation to a lot of businesses and now COVID-19 is a different type of devastation,” Sen. Kurt Vialet said.

Bars and businesses have been closed for 60 days or more during this calendar year Vialet said, “And now people are just not shopping like they used to. They are staying home.”

Because of the circumstances businesses have had to contend with, Vialet said, the legislature has to provide relief. He said the many challenges homeowners face is just as heavy a burden as those on people struggling to keep their businesses afloat.

“At this particular time, we will feel it is necessary,” Vialet said.

The measure now moves on to the Committee on Rules and the Judiciary.

Sens. Vialet, Frett-Gregory, Janelle Sarauw, Marvin Blyden, Oakland Benta, and Dwayne DeGraff were present for the Finance Committee hearing. Sen. Allison DeGazon was absent.

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