The VI government announced Monday that excise duty on goods imported into the territory would be resumed immediately after a judge overturned an injunction on the tax, which has been in place since 2018.
“This has been a long and costly litigation,” said Richard Motta Jr., government house communications director, during Monday’s weekly press conference.
Since former District Court judge Curtis Gomez issued the injunction in 2018, the area has been banned from collecting more than $ 84 million in excise revenue.
Gomez noted that the government had not set the excise tax on local manufacturers for more than 30 years, essentially penalizing importers of goods with an additional tax in violation of the U.S. Constitution’s trade clause.
The government appealed to the 3rd US Court of Appeals, which remitted the case with instructions to overturn the injunction if the government could demonstrate that it had begun collecting excise taxes on manufacturers.
For the month of January, the government levied only $ 26.61 in excise taxes on two candle and personal care product manufacturers. However, US District Court judge Robert Molloy said that was enough for him to lift the injunction against importers – with approximately $ 40 million in annual sales – despite government excise levies continuing “in several ways.” and lacking in several ways “.
The VI government was able to balance the budget without being dependent on excise duty collection, Motta said, and the excise tax revenue will now be used to repay government employees for the 8% wage cut that was later found illegal.
“Before we put these funds in the General Fund for State Operations, we will ensure that our employees remain our priority and therefore keep our promise to use the first excise tax rates to reverse the 8% wage cut in public sector employees as a result of the Economic Stability Act 2011, ”said Motta.
Motta didn’t respond to a question from The Daily News about how much money the government currently owes workers for this 8% wage cut.
The excise collection procedure is online and the return must be completed on the Bureau’s website, bir.vi.gov, according to Joel Lee, Director of the VI Bureau of Internal Revenue.
For any questions about excise duties, please contact Glenford Hodge, Excise Declaration Supervisor, at 340-715-1040, ext. 3201.