US Virgin Islands Capitulate ($105 Million)

Where else can you profit from making a product then collect taxes on the product you make to help you profit more in the future??

“ST. THOMAS – After hours of questioning and debating the merits of an agreement between the government and Cruzan VIRIL, senators on Tuesday voted 13-2 to ratify the contract.

The deal will keep Cruzan on St. Croix for at least the next 30 years, while also obligating a portion of the territory’s future rum tax revenues from the sale of Cruzan-produced bulk and branded rums in the U.S. to build the company a wastewater treatment facility, expand the Cruzan distillery to increase its production capacity, and also help support Cruzan’s marketing efforts.” (excerpt from Joy Blackburn of Virgin Islands Daily News)

Synopsis:

The US Virgin Island Territorial Government virtually capitulated tax revenues totaling $105 million because Cruzan (a subsidiary of the conglomerate Fortunebrands) used veiled threats that it would move its operations elsewhere.

Here is the breakdown of the deal:

(1)Cruzan makes profits for selling their product. Then 98% of the taxes on that product sold in the U.S. goes back to the Virgin Islands territory. (2)50% of those tax monies ($105 million) will then be given back to Cruzan to finance ”Project Bonds” with the understanding that they build a wastewater treatment facility on the Cruzan property as well as increase the size of the Cruzan facilities.  (3)Additionally some of the funds will go directly to MARKETING Cruzan products. ARE YOU FREAKIN KIDDING ME??

SIMPLY:  1)The government finances the expansion of Cruzan with “Project Bonds”  2)Cruzan makes money on sale of product  3)Cruzan makes money on taxation of their own product to pay back the “Project Bond” 4)Cruzan has taxpayers here in the U.S. pay for expansion of its facilities.  5)Cruzan has taxpayers here in U.S. pay for marketing its product.  6)Cruzan doubles its profits in the next 6 years.  Cruzan pays for nothing and gets everything!

Bottom line: people who purchase Cruzan Rum products here in the U.S. are paying tax to help fund a corporation’s profit machine!  Let’s be clear here, this is not a deal to further “economic progress” – that is just lip service.  This is LARCENY, which potentially affects millions of lives here on the mainland of the U.S. 

When the United States may close up to 80% of state parks in California due budget deficits, when local school boards in every state are having to cut budgets by 30-50% due to a lack of money from the government, when bonds for bridges & roads are slashed from the state & federal budget, when police & fire departments are reducing staff, when other social programs are entirely cut from the federal budget….Cruzan (Fortunebrands) is handed $105 million in tax revenues to pay for the expansion of it’s own profit center & help market their product??

$105 million.  Say it again…ONE HUNDRED & FIVE MILLION DOLLARS.

This is much worse than the AIG insurance bailout!  This is US tax dollars funding profits of a corporation not meant to benefit anyone on the US mainland except corporate shareholders.

Why don’t we just forget about taxing Cruzan products? It wouldn’t change anything here in the U.S. other than put a few bucks back into peoples’ pockets.  Better yet, why don’t we just forget about taxing products altogether?  No – why don’t we just forget about all taxes in general? 

The Virgin Islands are part of the UNITED STATES.  Corporations in the Virgin Islands operate in a FREE & DEMOCRATIC environment under the BLANKET OF PROTECTION of the strongest nation in the world. Taxes are meant to strengthen the United States as well as further it’s sovereign protection of satellite territories such as the Virgin Islands. 

The Virgin Island government, operating under the auspices of the United States, have in effect, become the regional legal mafia, utilizing federal funds to further establish profitability for a corporation… and who knows what else.