ST. THOMAS, US Virgin Islands, Jan. 26, 2017 /PRNewswire/ -- The report by the rating agency Standard and Poor's pointed out important issues concerning the U.S. Virgin Islands debt and financial conditions. That is why the Governor had ordered that a Five-Year Plan be developed with the goal of reducing the Government's deficit and developing a road map to fiscal stability. We believe the Five Year plan is a blueprint to deal with reducing Government structural deficits and provide fiscal balance and economic growth.
The Government has been working around the clock to enhance its liquidity situation which includes cuts in expenditures. The Governor recently signed an Irrevocable Instruction Letter to eliminate the notion that the Government would divert Matching Fund Revenues. More importantly, the Government has experienced financial distress in the past and has never defaulted on any of its secured debt. The Matching Fund and Gross Receipt Bonds are secure.
The Five-Year Plan includes new and comprehensive revenue initiatives that call for additional taxation for real property, as well sin taxes, rum, wine, brandy, cigarettes, beer, carbonated beverages, internet and gross receipts tax. The Virgin Islands Legislature is currently reviewing elements of the Five-Year Plan, and the Finance Committee of the Legislature will be meeting on January 31, 2017, to consider these recommendations.
We have already undertaken important steps to increase tax collection revenues by adding more tax examiners and increasing hotel occupancy taxes. First quarter of the fiscal year (October – December) tax revenues are expected to beat targeted budget expectations.
The VIPFA is not currently seeking capital from the municipal bond market at this moment. When appropriate credit ratings and acceptable interest rates are present, the VIPFA will assess whether to re-enter the bond market.
The Virgin Islands Gross National Product has increased for the first time in five years according to a report by the US Commerce Department and reflected growth in tourism revenues and consumer spending, which was up for the first time since 2010.
Contact: Lonnie Soury, Soury Communications, Inc., Lsoury@soury.com,
(212) 519-4521, (212) 414-5857
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/statement-from-virgin-islands-public-finance-authority-vipfa-300397416.html