Tuesday, September 26, 2017 5:55 am Last modified: 5:03 am

An Open Letter to Sen. Blyden

Editor’s note: Sen. Marvin Blyden, sponsor of the bill that is the focus of this letter, has pulled the bill from the Senate’s agenda due to the level of concern that has been voiced, and is holding a town meeting July 19 at the Legislature on St. John to hear voters’ comments.

Dear Senator Blyden,

This is in response to your proposed bill to quadruple property taxes for vacation rentals in the V.I.

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I am a 12th generation Virgin Islander and a licensed V.I. Realtor.

My questions and comments to you on this proposed legislation are as follows:

Questions:

How do you differentiate between vacation rental owners who live on island, pay taxes here, pay their business licenses, room tax, gross receipts taxes, homeowners and liability insurance from off island owner who’s sole purpose is using them for business?

There’s a lot of grey areas here.

Additionally, while those owners use them as businesses, there are many residents that also have vacation rentals solely as businesses and derive there income solely from their short-term rentals whose season is quite short, usually mid December – end of April, with summer/fall months basically inactive.

These rentals, whether locally owned or not, still bring much needed revenue to the V.I.

Their guests use local help to clean and maintain their properties, pay taxis, ferries, grocery stores, go to beaches, bars, restaurants, nightlife, shopping, go sailing, diving, snorkeling, pay admittance into the National Parks, take tours. These businesses pay taxes and fees, pay WAPA, buy water, require landscaping, plants, handyman services, buy and register cars here, buy gas, rent cars, support local businesses when buying new appliances, big and small, indoor or outdoor furniture, pay for phone, internet, cable TV, etc.

The list is endless.

Then there are those who dream of living here, warts and all, who are willing to buy a modest condo and rent to offset the expense while paying mortgage, HOA fees, homeowners and liability insurance and all of the above until they can fulfill their dream of moving here full-time that will be scared off from their dreams due to having their property taxes go up in addition to the already high costs associated with living in the USVI.

It makes it unaffordable.

Costs associated with vacation rentals is already extremely high. Some break even, some make a little profit, some don’t, for some it’s a write-off.

When taxes are raised, because our V.I. Government cannot seem to budget itself and continues to waste, misuse, misspend, mismanage and in some cases, outright steal our money and resources, it is not up to the taxpayer to constantly be forced to be the source of revenue for the government’s recklessness, dereliction of duty and fiscal irresponsibility.

What will happen is vacation rental owners, especially our local residents who depend on this meager income, will either attempt to sell their properties, convert to long term rentals, prices will go up on those that remain and our guests will look to the BVI and neighboring Caribbean Islands for a better value for their money.

Go ahead, kill another goose that lays a golden egg.

I am opposed to your proposed legislation.

Thank you for your consideration in this matter.

Alana Mawson

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  1. Richard J Doumeng Reply

    First let me say that I too oppose the proposed tax as presented. From the recent “Sin Tax” law to Gross Receipts going from 3% to 5% in a blink of the eye, to Hotel Occupancy Tax going from 8% to 10% to 12.5% in a few years…the “let’s tax businesses instead of fixing our own government” mindset must come to an end.
    That said, we are lying to ourselves by refusing to come to grips with the massive Underground Economy that is entrenched in our way of life. How many people, what % of the rental economy do you think pays income tax or gross receipts and room tax on their rental properties? Really?
    Realizing that duplicates and Timeshare Hotel listings are a big factor, still between HomeAway/VRBO (both now owned by Expedia!) and Airbnb there well over 2000 listings on STT/STJ for Non-Hotel Accommodations. Income Tax and/or Gross Receipts, Hotel Room Tax payments submitted monthly by how many of these owners? Please. And then we can discuss how many people who rent out apartments below their houses claim that income on their taxes.

  2. Alana Mawson Reply

    I’d like to add that we get very little for the property and all the other taxes we do pay:

    No mail delivery to our homes, terrible roads, no painted lines on many roads, terrible signage and lighting on these roads, potholes that’ll take your axle out, shabby, inadequate, expensive utility services, constant power outages, lack of bush and tree trimming on roadsides, electrical poles (a friend said that if a bird craps on their power line, power goes out), trash everywhere, lack of recycling, no trash pickup at homes, bankrupt hospitals, lack of senior care facilities, lack of individual healthcare insurance… seriously the list goes on while the government continues to spend uncontrollably and look to individual and business taxpayers to fund THEIR wasteful spending.

    How many CASH ONLY businesses (ferry services being subsidized and taxi drivers come to mind) pay their appropriate taxes, gross receipts, etc.?

    Quite frankly, I’m surprised that targeting a specific group for increasing taxes is even remotely legal? Has a legal opinion been sought prior to the creation of this bill?

    Remember, Commercial businesses took the VI Government to court over inequality of property taxes previously in early 2000…..and won, years later, while millions of dollars where spent and paid by VI Government/taxpayers to defend, then we paid double property taxes per year, for years, after the case was adjudicated.

    Where are our Senators crying out about crime, the blatant NEPOTISM in this administration? Where is a financial accounting of what our governor has spent, how many family members in his administration, how much the legislature spent this year, how many contracts that have been handed out, have excruciating delays, massive cost overruns,deplorable results (and eventual jail time), how many times does our government give away our money for their Pet projects or waste time passing unfunded bills while not paying what they owe and continuously sticking it to taxpayers to fund their ineptitude? GERS is a mess.

    I, for one, am sick of it.
    Senators need to think long and hard about reducing their bloated salaries, expenses, “perks”, and numbers before they BEFORE they pass any bills to burden the already overburdened public.
    Clean up your own act!

  3. Denise Holmberg Reply

    I am currently a homeowner about to start short terming my home for part of the year since I am taking to the high seas to live my dream. I am in the process of acquiring business license, doing my budget, hiring a property manager….if our government does indeed pass this law it would make it financially unattainable so I would have no choice to just lock my home and leave unoccupied….lets put it in perspective shall we?

    Let’s see what government will actually loose
    Island visitors?
    12.5% hotel tax on gross rental paid by the visitor!!
    Economic / tourism related fees like taxis restaurants activities
    Economic activity related to its maintenance
    Landscapers, pool guy, turn around cleaners maintenance staff

    The fees that I would collect will cover for the upkeep and expenses related to doing the short term. Gross receipts will probably be minimal as the Income will never make it pass the $225k a year annual threshold and probably only pass the $9k monthly on couple months a year. The profit is quite low actually.

    What are our options? properties instead of raising in value and be kept maintained will probably suffer from not being used and be locked up.

    Furthurmore, we already pay high property taxes for zero services….we have to even maintain our own roads, electrical infrastructure, bush cutting….we have our own sewerage treatment plant, we pay extremely high power rates….what do we get in return for over $3k a year in property taxes fees?

    I understand hotels feel the pinch from this new competition concept but as usual government is going down the easy road of adding burden. Instead of applying and enforcing the current laws and taxes.

    How many residents file or pay ANY taxes? How many when caught are on unrealistic payment plans for years and years? And do they even enforce those collections….look at the list of already unpaid property tax residents?

    Stop adding more burdens and start doing your jobs….start collecting from all the non complaints…..if I see a decent effort on that front, then and ONLY then should we even consider ANY increased taxes for ANY industry or individual

  4. Local Reply

    Alana for Governor and a Holmberg running the Lt. Gov’s Office. You got my vote!

  5. Well THAT happened Reply

    Sen. Blyden believes quadrupling the tax bill for the so-called rental villa is justifiable and fair. First of all, you cannot take 2 similar houses, used for whatever purpose the owner decides, within legal boundaries of course, and assess them a different tax rate. This is unconstitutional. Real property tax is an ad valorem tax, or a tax based on the value of property. Two owners of real property of equal value in the same municipality should pay the same amount in property taxes. Evidently he is not considering that the rental villa owner is already paying additional taxes (business licence, hotel tax, gross receipts tax, the $25.00 per night sin tax, additional liability insurance, and a myriad of other expenses). Responsible people in this community are beginning to question the actions and MOTIVES of the elected officials because they are blatantly being unfair to those of us who have been paying taxes all along. As stated by another commenter, the underground economy is taking it’s toll on the USVI. It’s time to stop ignoring and especially enabling these tax scofflaws (they know who they are). The people who have been singled out to pay and pay and pay for everyone else are being woke. It’s long past time for a federal take-over of this banana republic.

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