(Washington, DC, May 14, 2004)—Delegate to Congress Donna M. Christensen today urged representatives of Economic Development Commission companies to exercise caution in expressing their displeasure with a recently passed amendment to a U.S. Senate bill to avoid provoking an even stronger response by Congress to deficiencies in the EDC program.  The Delegate notes that some of the provisions in the Senate language require clarification and she pledges to work to address them when the U.S. House takes up the measure.

            “This is a process that isn’t over yet and I promise to sit down with everyone affected to hear their recommendations on how the language of the amendment should be improved to make our EDC program stronger,” Christensen said.

The amendment, passed by the U.S. Senate last week, establishes an objective test for determining when a U.S. investor can qualify for individual tax benefits under our EDC program as a "bona fide resident of the Virgin Islands”.   Under the amendment, a U.S. investor would have to be physically present in the Territory for an average of 122 days (four months) per year over a three-year period in order to qualify.  Even if the investor is not physically present at least 122 days over such three-year period, the investor will be afforded an opportunity under the Senate language to demonstrate to the IRS that, based on all of the facts and circumstances, he or she should still be deemed a "bona fide Virgin Islands resident" rather than a U.S. resident for tax purposes.

“I intend to continue to work with all affected parties to ensure that Congress and the Treasury Department develop fair and reasonable rules in order to ensure the integrity and effectiveness of the Territory's EDC program and to promote both tax compliance and economic growth,” Christensen said.