USVI, Guam to Get $296.6M In Rum Cover-Over Payments
The approval of an advance in rum cover-over payments by the U.S. Department of the Interior’s Insular Affairs Office will put $226.1 million in the territory’s coffers, along with $70.3 million for Guam, by Sept. 9.
2022-08-25 12:31:31 - VI News Staff
The payments represent rum tax cover-over and federal income tax Section 30 revenues estimated for fiscal year 2023, according to an Interior Office press release.
Under the Revised Organic Act, any excise tax collected on V.I. manufactured rum imported into the United States is transferred to or “covered-over” to the territory. The V.I. government submits an advance estimate of rum excise taxes to the Office of Insular Affairs on an annual basis so that a payment can be made by September of each fiscal year.
Any adjustments necessary are calculated and paid later based upon amounts advanced from rum excise taxes derived from the Virgin Islands and actual receipts collected by the federal government. The fiscal year 2023 advance payment to the V.I. government was calculated using the $10.50 per proof-gallon rate since the $13.25 per-proof gallon rate expired at the end of December 2021.