Economic Development Commission Benefit Companies

 

 

   

February 2, 2005

 

 

The Bornn Firm, PLLC, presents the following brief summary of essential points with reference to the U.S. Virgin Islands Economic Development Commission, (EDC) Benefits Program for your information:

 

Eligible Business

 

(a)     The approved industries or business and their established categories shall be:

 

1.      Category I -- Rum Production, Milk/Dairy Production, Watch and Jewelry Manufacturing and Assembly;

2.      Category II -- Product Assembly, Manufacturing (other than Jewelry and Watch Manufacturing and Assembly), Agriculture/Food Processing, Mari culture/ Food   Processing, Marine Industry, Raw Materials Processing, Hotels/Guesthouses, Transportation and Telecommunications;

3.      Category II A—Services Businesses, not limited to but including, Investment Managers and Advisors, Research and Development, Business and Management Consultants, Software Developers, E-Commerce Businesses, Call Centers, High Tech Businesses, International Public Relations Firms, International Trading and Distribution, and any other  businesses serving clients located outside the Virgin islands.

4.      Category III – Utilities, Healthcare Facilities, Recreation Facilities, Insurance Companies, Physicians Corporations, and such other industries or businesses as may be deemed appropriate by the Commission.  The Commission may grant benefits to such industry, business or enterprise only upon a finding that it is appropriate to do so and that such industry, business or enterprise will advance the economic well being of the United States Virgin Islands and its people.

 

Requirements for Granting Benefits

 

1.       Investment of minimum of $100,000.00, exclusive of inventory;

2.       Resident individual or business entity (partnership, corporation, limited liability company, limited liability partnership, trust) in the U.S. Virgin Islands and licensed to conduct business in the V.I.; pass through provisions for V.I. Resident owners.

3.       Be actual investor in enterprise making application;

4.       Employ at least 10 persons as Full Time employees, PROVIDED 80% are U.S.V.I. residents;

5.       Meet standards for “ ecological compatibility”;

6.       Employ with or contract for services and products from V.I. registered and licensed businesses;

7.       Provide educational assistance to V.I. residents through contribution to educational fund or providing training program;

8.       Establish management- training program;

9.       Appropriate level of charitable contributions;

10.    Maintain payroll account in U.S.V.I. Bank; 

Benefits

A. 100% Exemption from following taxes:

 

1.       Real Property Taxes on real property used in business

2.       Gross Receipts Taxes (tax on gross revenue)

3.       Excise Tax on building materials, tools, etc. used in construction, alteration, reconstruction or extension of business premises

 

B.  Reduction of tax liability as follows:

 

1.       90% on income taxes on qualified business income

2.       1% Customs Duty rate on raw materials and component parts used in industrial and manufacturing processing.

 

Benefit Term

 

Certificates issued for 10 years with the following exemption:

 

            -Christiansted Town, St. Croix - 20 years

-Frederiksted Town, St. Croix – 30 years

- Agriculture and Mari-culture –  25 years

 

All certificates are subject to renewal petition for an additional time period.

 

Special Notice

 

·        Recent Federal Law provisions require eligible taxpayers to be resident in the U.S.V.I. for a minimum of 183 days per year;

 

Services rendered to clients outside the U.S.V.I. MUST be rendered from the U.S.V.I. to qualify for Benefits treatment; personal services rendered in the U.S. will be treated as U.S.- sourced and not eligible for benefits treatment.

 

Economic  Development  Commission

Public Hearings

Schedule of Public Hearings 2005

APPLICATION DEADLINE:

January 13, 2005
February 24, 2005
April 7, 2005
May 19, 2005
June 30, 2005
August 11, 2005
September 22, 2005
October 27, 2005

PUBLIC HEARING:

February 10, 2005
March 22, 2005
May 5, 2005
June 16, 2005
July 28, 2005
September 8, 2005
October 20, 2005
   November 22, 2005 

Pursuant to Section 716-2 and 716-3 Rules & Regulations, application must be completed when submitted, but the Assistant Chief Executive Officer may temporarily waiver the receipt of certain letters or certifications to avoid delaying the Public Hearing. However, if approved, the Applicant WILL NOT RECEIVE ITS CERTIFICATE until the required documents, which may have been wavered, are submitted. The Assistant Chief Executive Officer CANNOT waive the following:

1.  The Certificates of Good Standing and Incorporation from the Corporate Section, Office of the        Lieutenant Governor.

2.  A letter from the Bureau of Internal Revenue indicating status of all Virgin Islands tax obligations.

(FOR BENEFICIARIES REQUESTING EXTENSIONS)

1.  A letter from the Bureau of Internal Revenue indicating status of all Virgin Islands tax obligations.

2.  Certification by the Commissioner of Labor that the Beneficiary is in compliance with all labor        laws, rules and regulations.

3.  The Hotel Occupancy Report Statement from the Division of Tourism, applicable to hotel             beneficiaries.

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