Flat rate
2.3%
Duration
—
Prior non-residency
—
required before applying
Standard top income tax
37.0%
US Virgin Islands, without the regime
Overview
- Regime
- VIEDC Economic Development Commission (EDC)
- Country
- US Virgin Islands
- Type
- Percentage exemption
- Status
- Active
- Effective from
- —
- Expires on
- —
Details
- Summary
- Congress-authorized incentives administered by the Virgin Islands Economic Development Commission: 90% reduction of Virgin Islands income tax on qualifying business income, with parallel relief for resident owners on dividends and distributive shares from the approved business.
- Eligibility
- Businesses granted an economic development certificate by the VIEDC; income must be from the approved industry and USVI-source or effectively connected.
- Benefits
- 90% reduction of VI income tax on qualifying business income (effective ~2.31% CIT on illustrated examples after the 21% rate and 10% corporate surcharge). Resident shareholders/partners may reduce tax on dividends or distributive shares attributable to the approved business by 90%. EDC beneficiaries may also be exempt from gross receipts, property and excise taxes per certificate terms.
- Requirements
- Approved certificate, substance and reporting requirements under Title 29 and VIEDC regulations; file required VI returns and claim reductions per statute.
- Limitations
- Applies only to income from the certified business and qualifying investments; not available to non–bona fide residents of the USVI on non-qualifying income. Federal gift/estate taxes are administered by the IRS, not mirrored by the BIR.
- Income types covered
- Income from the approved business or industry and qualifying investments; dividends and partnership distributions to resident owners from that income.
- Duration details
- Term set in the economic development certificate; renewable under VIEDC rules.
View source VI Code Tit.29 §713b; BIR Tax Structure Booklet; USVIEDA