USVI Receives $181 Million in Rum Tax Remittance, Down From Previous Years Due to Reduced Tax Rate

The U.S. Dept. of Interior announced Thursday that the U.S. Virgin Islands has received an advance payment of $181,068,638 in rum excise tax remittances from the Office of Insular Affairs (OIA), marking a significant source of revenue for the territory. However, this amount reflects a drop from previous years when the remittances were calculated at a higher tax rate of $13.25 per proof gallon of rum. Currently, the territory receives the funds at a tax rate of $10.50 per proof gallon, resulting in a lower payout. If the U.S. Virgin Islands had continued to receive the rum excise taxes at the previous rate, the territory would have garnered approximately $228.49 million, representing a difference of about $47.42 million. The rum tax remittances play a crucial role in supporting the territory’s bond covenants as well as the securitization of Government Employees' Retirement System. Therefore, any reduction in these payments can have lasting impacts. Delegate to Congress Stacey Plaske...