The Caribbean region has increasingly become a hotspot for businesses seeking a picturesque location and significant financial advantages. One standout initiative contributing to the economic success of the region is the Virgin Islands Research and Technology Park (RTPark). Through strategic tax reductions, the RTPark plays a pivotal role in attracting businesses and fostering economic growth in the region, particularly the U.S. Virgin Islands (USVI).

RTPark Tax Reductions - A Boon for Businesses

Under the provisions of the Internal Revenue and the U.S. Virgin Islands statutes, companies approved for benefits under the RTPark program are entitled to a host of financial advantages. These benefits serve as powerful incentives, drawing businesses to establish operations within the USVI. Let's delve into the key advantages that the RTPark offers to approved companies.

Up to 90% Reduction in Income Tax Liability

This substantial reduction in income tax liability is a cornerstone for businesses seeking financial stability and profitability. The USVI's allure is enhanced by the fact that RTPark-approved companies can benefit from up to a 90% reduction in income tax. This allows businesses to retain more of their earnings and provides the necessary financial cushion for expansion, research and development, and talent acquisition.

Economic Benefits: These USVI tax breaks make the Caribbean an attractive destination for businesses looking to optimize their bottom line while contributing to the local economy through job creation and investment.

Exemption on Real Property Taxes

For businesses that rely on physical facilities, the exemption on real property taxes becomes a crucial financial advantage. RTPark encourages companies to invest in infrastructure by eliminating this tax burden, fostering growth and development.

Economic Benefits: This exemption is a powerful incentive for businesses to establish a tangible presence in the U.S. Virgin Islands, promoting the construction and maintenance of state-of-the-art facilities, which, in turn, contribute to the territory's overall development.

Exemption from USVI Gross Receipts Taxes

The RTPark offers a key tax benefit by exempting businesses from the U.S. Virgin Islands' gross receipts tax, which is a charge on total business revenue. This exemption significantly enhances companies' financial health by improving cash flow, thereby reducing operational financial burdens. This strategic approach fosters a thriving, business-friendly environment, contributing to sustained economic growth in the region.

Economic Benefits: By exempting businesses from this tax, the USVI aims to create a conducive atmosphere for companies to reinvest in their operations, drive innovation, and stimulate economic growth in the Territory.

Excise Tax Exemptions

The exemptions from excise taxes on various items, including building materials and raw materials, are essential for businesses involved in construction or manufacturing.

Economic Benefits: This benefit significantly reduces the cost of acquiring necessary supplies, encouraging businesses to invest in expanding their physical infrastructure and enhancing their production capabilities. The resulting reduction in operational expenses further positions the USVI as a competitive destination for businesses seeking cost-effective and resource-efficient operations.

Withholding Tax Benefits

Withholding tax benefits are instrumental in attracting international investment. By exempting businesses from withholding tax on interest and providing a reduced rate on dividends and royalties, RTPark ensures that investors receive a higher return on their investments.

Economic Benefits: This incentivizes foreign investors and encourages local shareholders to participate actively in RTPark-approved companies. The reduced withholding tax rate promotes a more attractive investment climate, fostering capital inflow into the U.S. Virgin Islands.

Customs Duties Reduction

Reducing customs duties on raw materials and parts is a strategic move to promote manufacturing and assembly activities within the U.S. Virgin Islands. Lowering the customs duties from 6% to 1% makes importing essential materials more cost-effective for businesses.

Economic Benefits: This encourages companies to establish regional production facilities, spurring job creation and contributing to the development of a diversified and sustainable local economy.

Shareholder Benefits

Extending financial benefits to shareholders, members, and partners creates a symbiotic relationship between businesses and their stakeholders. The 90% reduction in income taxes on dividends enhances the attractiveness of RTPark-approved companies for investors, fostering long-term partnerships.

Economic Benefits: This benefit rewards shareholders for their investment and aligns investors' interests with the business's success, promoting stability and continuity in the business landscape.

Protection Against Tax Changes

The assurance that RTPark-approved companies will not be subjected to any new taxes or tax increases during their benefits provides a critical level of stability for businesses. This protection against tax changes allows companies to confidently plan their long-term strategies, knowing that the agreed-upon tax incentives will remain intact.

Economic Benefits: This stability particularly appeals to businesses making significant investments in the region, as it mitigates the risk associated with unforeseen tax policy changes and creates a secure business environment conducive to sustainability. 

The RTPark Can Help Make the USVI Your Home!

Each financial advantage is carefully designed to address businesses' specific needs and challenges. From reducing income tax liabilities to promoting physical infrastructure development and encouraging international investment, RTPark's comprehensive incentives package makes the U.S. Virgin Islands an enticing destination for businesses seeking a strategic and advantageous location in the Caribbean.

Have an annual gross revenue of $1M or more? Click here to get a better idea of the tax savings!

Ready to become a part of this growing hub for economic advantages? Apply to be an RTPark member or connect with one of our Business Attraction team members to learn more!