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'Legal actions' needed for 50% remittance tax cut to take effect- Financial Secretary

'Legal actions' needed for 50% remittance tax cut to take effect- Financial Secretary

Persons sending monies out of the Virgin Islands (VI) via Western Union and Moneygram will notice that they are still paying a 7% tax on transactions, despite Government announcing it is slashing the fee by 50%.

According to Acting Financial Secretary Mr Jeremiah G.A. Frett, the Cabinet’s decision to cut the levy by 50-percent (50%) on July 20, 2022, will not come into effect until the necessary legal actions are taken.

He said; however, Government is moving forward with the necessary steps to enact a reduction from 7-percent to 3.5-percent on the money services levy.

Acting Financial Secretary Mr Jeremiah G.A. Frett has said Cabinet’s decision to cut the levy by 50-percent (50%) on July 20, 2022, will not come into effect until the necessary legal actions are taken.


What are the necessary legal actions?


Mr Frett said those actions include an amendment to Schedule 3 and Section 45A of the Financing and Money Services Act, Revised Edition 2020 (as amended by Act No. 6 of 2020); the drafting of the relevant Order for the aforementioned amendments; the publishing of the Order in the Official Gazette; and the laying of the Order on the table of the House of Assembly at its next convenient Sitting.

The Financial Secretary in a Government Information Services (GIS) press release on July 27, 2022, noted, “We thank the public for its patience as we work towards the official enactment of the reduced levy,” adding that the public will be notified via the Government of the Virgin Islands’ official website and social media channels.

Tax cut means less revenue for Gov’t- Premier


Premier and Minister of Finance Dr the Honourable Natalio D. Wheatley (R7) had announced the 50-percent reduction on remittance tax during a press conference on July 22, 2022.

He said that a “large segment of the VI population uses the remittances services” and the hope is that it can help students and families abroad to cope with the current economic challenges.

Dr Wheatley said while Government may collect less revenue, the reduction may encourage a greater volume of transactions.

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