It has been weeks since Hurricane Maria swept through the U.S. Virgin Islands, causing catastrophic damage to the Territory’s buildings and infrastructure. However, the Territory still finds itself in great need of federal assistance.
In mid-October, a group of Democratic lawmakers sought tax relief for both Puerto Rico and the U.S. Virgin Islands, which were hit extremely hard by the hurricanes of September. The crux behind the lawmakers’ plea was that people and businesses in the two territories do not enjoy the same benefits as those on the mainland. Thus, assistance for them is harder to get than their fellow citizens in Florida and Houston.
The House of Representatives did pass a $36.5 billion disaster aid package for Puerto Rico and the U.S. Virgin Islands, but experts and lawmakers characterized that amount as “paltry” for the people of the territories. Residents still do not have access to many of the tax benefits typically provided by the federal government in disaster scenarios.
The requests for aid have been somewhat overshadowed by Congress’s push to pass a $6 trillion tax overhaul plan that has long been championed by President Donald Trump and other conservative leaders. But the requests for aid continue to come in.
Democrats also asked a federal panel—the Ways and Means Committee—to permanently reinstate the tax system for rum, in which excise taxes collected on rum made in the U.S. Virgin Islands and Puerto Rico get paid to the federal government, but are then transferred back into the territories. In addition, lawmakers asked the panel to provide more financing for the New Markets Tax Credit to help businesses lost in Hurricane Maria recover.
Governor presses Trump for help
In addition to the relief requests members of Congress have made, U.S. Virgin Islands Governor Kenneth E. Mapp also met directly with President Trump in October and detailed the dire situation. Mapp told the President that the U.S. Virgin Islands needs up to $750 million to rebuild after the devastation the hurricanes caused. He has subsequently increased his ask to $7.5 billion.
While Mapp expressed gratitude for the funding the Territory has already received, he also specifically pointed out that funding is needed to rebuild schools and hospitals. Four schools were condemned on St. Thomas and St. Croix, and both the Territory’s hospitals need to be rebuilt completely.
The Governor also spoke with the President about redesigning the Territory’s power distribution system so that it would be underground. This would make for more expedient recoveries when future storms hit the region.
The rebuilding process will certainly be long and arduous, but there are lawmakers who continue to seek relief on behalf of the U.S. Virgin Islands. If you have questions about your options as you work to rebuild your business and your life in the Territory, consult a corporate planning attorney.
- Nash Davis is an associate in the Corporate, Tax and Estate Planning Practice Group at BoltNagi PC, a full service business law firm on St. Thomas, U.S. Virgin Islands.