Why Your Next Investment Should Be in the USVI

Comprised of St. Croix, St. John, and St. Thomas, the United States Virgin Islands (USVI) have long been known as a popular Caribbean tourist destination. But recently, the U.S. Territory completed Vision 2040, a 20-year economic development strategy intended to elevate their business acumen through investment and the diversification of the economies of the expanding islands. Boasting lucrative tax incentives, specialized programming, and various economic development tools, we spoke to Wayne L. Biggs, Jr., CEO of USVIEDA, to find out why now is a great time to invest in the USVI.

Why Should You Invest in the USVI?

Wayne L. Biggs, Jr., CEO of Virgin Island Economic Development Authority (USVIEDA) / Photo: Joseph Rudy LaPlace, Creating Memories Photography/VI Economic Development Authority

Over the last few years, the USVI has seen an influx of family offices and financial entities moving to the destination. “The territory has more bandwidth than anywhere, with the exception of New York, as a result of all the submarine cable systems landing on St. Croix for maintenance,” says Biggs. “We have a great tax program that can assist where we can help reduce federal income taxes by up to 90 percent, depending on the type of business entity.” In addition, a variety of major airlines have begun flying to the destination from several U.S. gateways, making it more accessible than ever. Since the islands are an organized U.S. territory, a passport is not required for U.S. travelers, and visitors (or people conducting business) can easily fly in and out.

Main Services and Incentives

Wilfred Allick Transshipment Center / Photo: Virgin Islands Port Authority

The USVI has unveiled a variety of financial incentives and programming to draw businesses into the destination. For instance, the Economic Development Commission Program offers investors a 90 percent reduction on federal income taxes for the corporate entity. “Congress has allowed us to reduce our income tax rates for economic development purposes,” explains Biggs. “The program is congressionally approved and it’s IRS tested, so because there is no additional territorial tax or additional country taxes, it’s just one tax.”

In addition to the Economic Development Commission Program, the territory has also launched Vision 2040 and the Trade Zone Program. “Vision 2040 allows entities that are looking at investment to get involved in a 20-year economic plan,” says Biggs. It allows investors to look at the bigger picture and see if they have realistic goals and use it as their guidelines.

The VIEDC program benefits a variety of different entities. “It benefits financial and technical services,” says Biggs. It benefits hotels, professional services, back-of-office operations, call centers, and more, which is why it’s so appealing to investors. “In addition, we also have a program called the Hotel Development Act, where we can assist developers interested in the hospitality industry,” says Biggs. The program allows the USVI to rebate a portion or all of the occupancy taxes investors generate to help liquidate any debt they accrued for a period of 30 years, or until the debt is liquidated. The VIEDC program and the Hotel Development Program can be combined.

What Investors Should Know

Aerial view of St. Thomas / Photo: Steve Heap, Adobe Photo Stock

As with any investment, consumers should do their due diligence. “However, the island has put forth a variety of tax incentive programs that are congressionally approved and IRS tested,” says Biggs. “We have roughly 93 beneficiaries in the EDC program right now and have another 10 to 15 that have been approved but have not activated,” he says.

The island climate, bandwidth, workforce, and accessibility are just a few of the factors that make this investment in the Caribbean so appealing.