Citing 2017 Hurricanes, Majority Caucus Will Seek Delay Of Property Tax Increase Set To Take Effect This Month

Majority Caucus senators will meet in session later this month to delay in part the implementation of Act  No. 7984, called the Revenue Enhancement and Economic Recovery Act. The Act, among other tax increases, including the infamous sin taxes, established a base property tax of $360 for Virgin Islands homeowners — including those who qualify for tax exemptions — among them the disabled, the elderly and veterans.

In a release issued Thursday, Senate Majority Leader Neville James said the 2017 hurricanes had caused hardships on residents, and the property tax hike would be adding another bill to already burdened Virgin Islanders. “Due to the territory’s horrific encounter last fall with Hurricanes Irma and Maria, circumstances have changed. Local homeowners, especially families and senior citizens whose houses were severely damaged as a result of the storms, should not be burdened with the tax increases at this time,” Mr. James said.

Mr. James said the property tax increases were aimed at reducing the governments structural deficit and help raise enough revenue to keep government agencies open amid the ongoing budget shortfall. He said the package was also implemented as a sign of reassurance to the financial markets that had downgraded the USVI’s debt and were no longer lending to the territory. (Those efforts did not change the market’s stance on the territory, however.)

And there was mounting pressure on lawmakers following the Limetree Bay oil refining agreement’s ratification, birthed by an accusation that big corporations were not paying any taxes while residents were being burdened to foot higher rates. For Mr. James, however, the timing of the pending tax increase, which is set to take effect on August 31, was cause for concern and action.

“While we understand the government’s needs to generate revenue in order to meet our obligations, the implementation pursuant to the property tax amendment, from timing perspective, is fundamentally wrong. The Majority Caucus is unanimous in this belief and that was the impression I received when speaking to the governor,” Mr. James said.

“It is my understanding that a minority member currently has authorship to the legislation and has been sitting on the corrective language for quite some time, however the Majority Caucus is confident that we will address the matter in the best interest of all property tax payers”, Mr. James said. “My advice to property tax payers is to hold off on making your 2018 payment until the Legislature takes up this issue in earnest later this month. In the interim, the Majority will work on what we believe is the proper formula so as to not adversely impact our resident property taxpayers.”