In a bid to encourage economic development in the US Virgin Islands (USVI), in particular, reinvestment in tourism, lawmakers in the autonomous US territory last month enacted the Hotel Development Bill (No. 33-0104).
The Hotel Development Program is designed to incentivise the development of new hotels, resorts and other related tourism facilities in the USVI. The legislation allows hotel developers to use a portion of the 12.5 per cent occupancy tax to repay long-term loans, which can help in obtaining financing for projects.
In addition, revenue collected for the Economic Recovery Fee — a 7.5 per cent deduction from guests’ hotel bills — will finance the renovation of existing hotels and the development of new hotels and resorts, including commercial and other related facilities.
“The signing of this Bill is a game-changer for the territory’s hospitality industry. It will significantly benefit hotels, resorts and businesses impacted by increased tourism and accelerate opportunity for employment in the territory,” CEO of USVIEDA, Kamal I Latham, said.
“The US Virgin Islands, America’s business paradise in the Caribbean, is committed to supporting tourism development with public-private partnerships. We encourage prospective investors to explore the competitive tax incentives offered here under the US flag.”
The legislation will be administered through the USVIEDA.
It is anticipated that the financial assistance gained through the Hotel Development Bill will encourage developers to woo potential investors in the capital markets their financial standing should be improved. This would in turn drive hotel and resort development projects forward in the USVI.
“The Bill demonstrates government commitment to hotel companies through upfront investment in new hotel supply and upgrades to existing tourism products as well as creating career opportunities for residents.”— William J Tennis, executive vice-president of DiamondRock Hospitality Company — owners of Frenchman’s Reef Marriott Resort and Noni Beach Resort
According to Bill Tennis, executive vice-president of DiamondRock Hospitality Company — owners of Frenchman’s Reef Marriott Resort and Noni Beach Resort, “The Bill demonstrates government commitment to hotel companies through upfront investment in new hotel supply and upgrades to existing tourism products as well as creating career opportunities for residents.”