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Friday, July 1, 2022
HomeNewsArchivesB.V.I. HEAD TAX AS MUCH A PROBLEM AS '6-PACK RULE'

B.V.I. HEAD TAX AS MUCH A PROBLEM AS '6-PACK RULE'

To the Source:
Upon reading your recent article concerning the efforts of the V.I. yachting community and the Coast Guard to come up with a local solution to the current situation [See "Equivalencies might avoid 6-pack limits"], I would like to offer some comments and observations.
First, I should state, I have been owner/operator of an inspected vessel since 1983 (six-pack from 1977 to 1983). I applaud the cooperation of the Coast Guard and the V.I. marine industry in searching for a common-sense solution to the current six-passenger restriction. I have always felt that six passengers is arbitrary and that most modern vessels can safely carry more passengers, the number of which could be based on their size.
The statement that the six-pack regs went into effect in 1988 is inaccurate. The regulations were clearly in effect prior to 1977. Since our charter industry was booming in the 1980s, I find it inaccurate to imply that these regulations were the sole cause for which term charter yachts moved to the British Virgin Islands. Another factor I think one has to explore is the effect of the daily head tax that the B.V.I. government places on vessels entering the B.V.I. from out of St. Thomas or St. John (or elsewhere). At $10 per charter guest per day, for a four-passenger vessel, this amounts to $280 per week to cruise the British Virgins, which is equivalent to 10 percent of the charter fee in many cases. Multiply that by 20 weeks of charter and compare that figure to the cost of a business license in the B.V.I., and I believe the economic reason for charterers to relocate from the U.S. to the British Virgins becomes clear.
B.V.I. boats, on the other hand, have no such tax burden when entering the U.S.V.I.
The eight-passenger boats, if they rebase in the U.S.V.I., will be subject to even higher amounts when they take their guests into the B.V.I. If this fee had no impact on the decision of where to locate, then the U.S.V.I. should have the majority of vessels carrying six or fewer overnight passengers and the B.V.I. should have all the larger boats.
While acceptance of equivalencies to comply with the six-pack regulations can be a positive first step, I do not see it as the panacea for the local charter industry.
Steve Marsh
St. Thomas

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To the Source:
Upon reading your recent article concerning the efforts of the V.I. yachting community and the Coast Guard to come up with a local solution to the current situation [See "Equivalencies might avoid 6-pack limits"], I would like to offer some comments and observations.
First, I should state, I have been owner/operator of an inspected vessel since 1983 (six-pack from 1977 to 1983). I applaud the cooperation of the Coast Guard and the V.I. marine industry in searching for a common-sense solution to the current six-passenger restriction. I have always felt that six passengers is arbitrary and that most modern vessels can safely carry more passengers, the number of which could be based on their size.
The statement that the six-pack regs went into effect in 1988 is inaccurate. The regulations were clearly in effect prior to 1977. Since our charter industry was booming in the 1980s, I find it inaccurate to imply that these regulations were the sole cause for which term charter yachts moved to the British Virgin Islands. Another factor I think one has to explore is the effect of the daily head tax that the B.V.I. government places on vessels entering the B.V.I. from out of St. Thomas or St. John (or elsewhere). At $10 per charter guest per day, for a four-passenger vessel, this amounts to $280 per week to cruise the British Virgins, which is equivalent to 10 percent of the charter fee in many cases. Multiply that by 20 weeks of charter and compare that figure to the cost of a business license in the B.V.I., and I believe the economic reason for charterers to relocate from the U.S. to the British Virgins becomes clear.
B.V.I. boats, on the other hand, have no such tax burden when entering the U.S.V.I.
The eight-passenger boats, if they rebase in the U.S.V.I., will be subject to even higher amounts when they take their guests into the B.V.I. If this fee had no impact on the decision of where to locate, then the U.S.V.I. should have the majority of vessels carrying six or fewer overnight passengers and the B.V.I. should have all the larger boats.
While acceptance of equivalencies to comply with the six-pack regulations can be a positive first step, I do not see it as the panacea for the local charter industry.
Steve Marsh
St. Thomas