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HomeNewsArchives2001 BUDGET TIED TO HIKE IN GROSS RECEIPTS TAX

2001 BUDGET TIED TO HIKE IN GROSS RECEIPTS TAX

Gov. Charles W. Turnbull delivered a $429.6 million budget to the Legislature Monday, and asked for a temporary increase in the gross receipts tax to help balance it. Under the proposal, the tax would go to 5 percent from the current 4 percent for one year.
The administration also proposed:
– To eliminate the road tax exemption for taxi drivers and impose on all drivers a highway user fee and an annual $10 vehicle disposal fee, in addition to the road tax;
– To charge a fee to companies applying for Industrial Development Commission incentives and to impose penalties for non-compliance with IDC agreements. Existing beneficiaries that opt to forgo their benefits in the coming fiscal year would get an automatic extension of three years.
– To impose tipping fees, as set by Public Works, for sewage disposal;
– To increase collection of delinquent property, income and other taxes.
On the cost-saving side of the ledger, Turnbull is proposing:
– To require government employees to split their health insurance and retirement contributions 50/50 with the government, for a savings in retirement costs estimated at $7.3 million;
– To reduce payroll/fringe benefits. Details are to be announced.
– To implement a "voluntary separation incentive proposal," i.e., encourage early retirement.
The administration relies on shifting money from special funds to help meet expenditures, and some shifts are sure to be controversial. One is to move $3.5 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. Another is to transfer $1.5 million from the Land Bank Fund to the General Fund. A third is to appropriate from the Tourism Advertising Revolving Fund to Housing, Parks and Recreation to pay for carnival/festival celebrations on St. Thomas, St. Croix and St. John.
At $429,640,877, the fiscal year 2001 budget is well below Turnbull's original proposal for 2000 of $466,383,701, and still under the pared-down, $450.2 million budget that eventually became law.
Despite the proposed cuts in employee costs, they still represent more than 68 percent of the 2001 budget — 55.04 percent for personnel services and 13.33 percent for benefits.
The largest departmental appropriation would be to Education, $121.3 million. Other executive departments and agencies with relatively high appropriations are Human Services, $28.9 million; Police, $28 million; Health, $25.96 million; and Justice, $24.1 million.
The University of the Virgin Islands is slated for $23 million; Territorial Court, $18.9 million; and the Legislature, $13.8 million.

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Gov. Charles W. Turnbull delivered a $429.6 million budget to the Legislature Monday, and asked for a temporary increase in the gross receipts tax to help balance it. Under the proposal, the tax would go to 5 percent from the current 4 percent for one year.
The administration also proposed:
- To eliminate the road tax exemption for taxi drivers and impose on all drivers a highway user fee and an annual $10 vehicle disposal fee, in addition to the road tax;
– To charge a fee to companies applying for Industrial Development Commission incentives and to impose penalties for non-compliance with IDC agreements. Existing beneficiaries that opt to forgo their benefits in the coming fiscal year would get an automatic extension of three years.
– To impose tipping fees, as set by Public Works, for sewage disposal;
– To increase collection of delinquent property, income and other taxes.
On the cost-saving side of the ledger, Turnbull is proposing:
– To require government employees to split their health insurance and retirement contributions 50/50 with the government, for a savings in retirement costs estimated at $7.3 million;
– To reduce payroll/fringe benefits. Details are to be announced.
– To implement a "voluntary separation incentive proposal," i.e., encourage early retirement.
The administration relies on shifting money from special funds to help meet expenditures, and some shifts are sure to be controversial. One is to move $3.5 million from the Union Arbitration Award and Government Employees Increment Fund to the General Fund. Another is to transfer $1.5 million from the Land Bank Fund to the General Fund. A third is to appropriate from the Tourism Advertising Revolving Fund to Housing, Parks and Recreation to pay for carnival/festival celebrations on St. Thomas, St. Croix and St. John.
At $429,640,877, the fiscal year 2001 budget is well below Turnbull's original proposal for 2000 of $466,383,701, and still under the pared-down, $450.2 million budget that eventually became law.
Despite the proposed cuts in employee costs, they still represent more than 68 percent of the 2001 budget -- 55.04 percent for personnel services and 13.33 percent for benefits.
The largest departmental appropriation would be to Education, $121.3 million. Other executive departments and agencies with relatively high appropriations are Human Services, $28.9 million; Police, $28 million; Health, $25.96 million; and Justice, $24.1 million.
The University of the Virgin Islands is slated for $23 million; Territorial Court, $18.9 million; and the Legislature, $13.8 million.