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HomeNewsArchivesU.S. HOUSE OKS DUTY, RUM-TAX, WATCH ADVANTAGES

U.S. HOUSE OKS DUTY, RUM-TAX, WATCH ADVANTAGES

Nov. 20, 2003 – The Virgin Islands has three reasons to applaud passage in the U.S. House of Representatives on Thursday night of the Tax Relief Extension Act.
Delegate Donna M. Christensen said in a release that the measure includes provisions for the territory to retain its historic 2-to-1 edge over other destinations in the duty-free allowance for travelers returning to the U.S. mainland, to benefit from the rum tax cover-over for another year, and to receive concessions for its watch industry.
"As expected, the Virgin Islands duty-free exemption will be increased from $1,200 to $1,600, thus maintaining our historic advantage," Christensen said. She said she was "elated that this provision has passed in light of the increase in duty exemption for other Caribbean countries contained in the bill."
The bill increases the duty-free allowance in those countries to $800 from the current $600 in order to bring the region in line with the rest of the world.
"I am also pleased that our rum tax rebate will remain at $13.25 [per gallon] for another year, although there are still items to be worked out in this regard," Christensen said.
The House-approved measure contains language to permit the drawback of duty for articles shipped from the mainland U.S. to the territories and to make certain adjustments to the federal Production Incentive Certificate program for watch and jewelry produced in the U.S. insular areas, the release stated.
"This legislation is expected to expand the watch and jewelry manufacturing industry in the Virgin Islands, keeping it competitive with their foreign locales who don't have to pay minimum wages or comply with other U.S. labor and environmental laws, even when all duties on watches are eliminated," Christensen said.
The legislation also must be approved in the U.S. Senate and then go to the president for signature in order to become law.
The delegate had announced in a release on Wednesday that the Miscellaneous Tariffs Bill approved by the House Ways and Means Committee on Wednesday would provide for the territory to retain its duty-free edge over other Caribbean destinations.
She said the "hard-fought battle" to maintain the Virgin Islands' historic advantage was won "because of a team effort" on the part of her office, the Turnbull administration, the St. Thomas-St. John Chamber of Commerce and the Havensight and Main Street merchants' associations.
She singled out Cassan Pancham, president of the St. Thomas-St. John Chamber of Commerce, "for recognizing the importance of this issue to the economy of St. Thomas and the Virgin Islands and making himself available to travel to Washington to meet with members of the House and Senate."
On Thursday, meanwhile, the territory's Republican Party national committeeman, Holland L. Redfield II, issued a release crediting House Republicans for the bill's approval in the Ways and Means Committee, citing local Republican efforts on its behalf and criticizing Christensen, a Democrat, for what he described as her failure to work with him regarding the measure.
The release said Redfield "has been working closely" with key Republicans in lobbying for the increase in the territory's duty-free allowance. He "recognized" Christensen for her "efforts on this issue" but the release stated that "he wished that the congresswoman had personally contacted him so that our efforts could have been coordinated on a bipartisan basis."
Redfield described the duty-free legislation as "a prime example" of why the Republican and Democratic Parties in the territory "should be working together." And he said that the territory's GOP chair, James Oliver, and its national committeewoman, Lilliana Belardo de O'Neal, have "consistently reached out to the Democratic Party with little success."
"There is no question," Redfield said, that U.S. Rep. Bill Thomas, Ways and Means chair, who introduced the legislation increasing the duty-free allowance, "looked for support from Republicans in the Virgin Islands." And he called on "the governor and the delegate to work closely with local Republicans that have access to the Republican leadership in Washington."

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