Home News Local news Federal Economic-Stimulus Package Would Benefit Territory

Federal Economic-Stimulus Package Would Benefit Territory

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Feb. 8, 2008 — Legislation aimed at stimulating the U.S. economy is on its way to the president's desk after passage by a House vote of 380 to 34 on Thursday, and it includes provisions that help the territory.
"The good news for the Virgin Islands and other U.S. territories with a mirror tax system is that it protects our treasury from any loss," Delegate Donna M. Christensen said in a statement released Friday. "More importantly our people will be receiving extra cash that can shore up the Virgin Islands economy starting in May."
The house passed a smaller stimulus package in late January. (See "U.S. House Bill for Tax Rebates Would Reimburse Territory.") The Senate passed a somewhat more generous bill earlier Thursday by a vote of 81 to 16. The House opted to vote on the Senate bill rather than go into conference committee with the Senate and create a compromise bill. The bill will now go to the president for his signature into law.
The stimulus is expected to provide $600 per individuals who make up to $75,000 annually, $1,200 per married couple who make up to $150,000 and $300 per dependent child. Low-wage workers who earned at least $3,000 in 2007 will get at least $300. The U.S. Senate also added provisions that would give $300 for disabled veterans and seniors living on Social Security.
The stimulus also increases the opportunity for homeowners affected by the mortgage crisis to refinance their homes, Christensen said.
"It increases the loan limits for single-family loans from $417,000 to $729,000 for one year for loans made between July 31, 2007 and Dec. 31, 2008," she said. "While there were few sub-prime mortgages in the Virgin Islands, residents with friends or family who may be caught in this situation can advise them of this provision."
Small businesses will benefit from the stimulus because they can write off taxes for capital investments made in 2008 up to $250,000, and for purchases of new equipment up to $800,000. It also provides immediate tax relief for all businesses to invest in new plants and equipment by speeding up depreciation provisions so plants can write off an additional 50 percent for investments purchased in 2008.
When the first house bill was passed a week ago, Christensen said the successful effort to include revenue relief for the Virgin Islands shows the value of collaboration between the governor and the delegate.
"This is the kind of collaboration that works really well between the governor's office and my office," she said. "He (Gov. John deJongh Jr.) spoke about these issues in the State of the Territory Address, his office has been working closely with mine on this and he has worked on his own, as well."
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