US VIRGIN ISLANDS Trends and Developments Contributed by: Marjorie “Jorie” Roberts, Sean Foster, Alexander Polinsky and Duncan J. J. Kessler, Marjorie Rawls Roberts P.C.
RTPark application requires a USD2,500 application fee and a USD2,500 background check fee. Benefits under the RTPark programme are initially available for 15 years and can be renewed for an initial renewal period of ten years, followed by subsequent renewal periods of five years, subject to RTPark board approval. Legislation for Online Gaming and Sports Betting Markets The USVI Casino Control Commission (CCC), which oversees the two licensed casinos in the USVI, is also calling for updated legislation to allow the USVI to fully participate in online gaming and sports betting markets. The CCC is also calling for updates to the USVI’s Internet Gaming and Gambling Act of 2001. The United States’ sports betting revenue reached USD13.8 billion in 2024, as identified by the CCC’s Chair. Legal requirements for tax incentives The USVI can grant tax benefits on any USVI source income and on certain income that is effectively con - nected with a USVI business, such as non-US source dividends, interest and royalties. USVI source income includes fee income for services performed in the USVI. Capital gains realised by a USVI business may also be eligible if certain requirements are met. Residency requirements The EDC and RTPark programmes provide personal tax benefits for bona fide USVI residents on their allo - cations or dividends. To be a bona fide USVI resident, a person must: • meet one of five alternative physical presence tests each year; • have a closer connection to the USVI than any other location; and • have a USVI tax home. The most-used “physical presence” test involves being in the USVI for all or part of 183 days in a given year. However, individuals who travel frequently can satisfy the physical presence test by spending no more than 90 days in the USA each year or by not having a significant connection to the USA at any time
during the year (such as having a home or children located in the USA). The establishment of a “closer connection” involves factors such as the following (although no single factor is determinative): • having a home; • filing returns as a USVI resident; • obtaining a USVI driver’s licence; • registering to vote and voting in the USVI; and • having a USVI bank account. A “tax home” is an individual’s principal place of busi - ness. In most cases, the individual must be a bona fide resi - dent of the USVI for the entire year to obtain benefits on their income from the benefited business, although there is a “year of move” rule permitting individuals to be bona fide residents if they move to the USVI in the first half of a year and remain USVI residents for the next three years. Tariff benefits As the USVI is outside the US customs zone, it has enacted its own customs law, imposing a 6% duty on items not manufactured in the USA. However, items can be imported into the USVI (and specifically the SSTZ) free of customs duties, and if “substantial trans - formation” then takes place in the USVI, the newly transformed or manufactured items can be imported into the United States free of any US tariffs pursuant to General Headnote 3 (a)(iv) of the US Harmonized Tariff Schedule. Opportunity Zone Benefits OBBBA extends the Federal Opportunity Zone pro - gramme, which also applies in the USVI. The renewal of Opportunity Zones presents a significant opportu - nity to accelerate economic development in the USVI – particularly on St Croix. Opportunity Zones are federally designated areas that offer capital gains tax relief to investors who make long-term commitments in under-served communi - ties. The goal is to stimulate private investment, cre - ate jobs and foster economic revitalisation in areas that need it most.
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