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manufactured in or brought into the Virgin Islands for sale or disposition in the course of a trade
or business, for processing or manufacturing, or for any other business purpose. The excise tax is
based on the invoice value of such merchandise, plus a mark-up of five percent. Rates of tax
depend upon the applicable category. The excise tax payment is an online filing and payment
process, utilizing credit cards for the payment of the tax. Taxpayers can access the excise tax
website by going to https:excise.bir.vi.gov.
Drugs, medicine, and clothing are taxed at two percent; tires are taxed at five percent; self-
propelled vehicles, firearms, ammunition and bicycles are taxed at ten percent; U.S. beers are
taxed at $5.00 per case; foreign beers at $6.08 per case; all liquors, rum, and spirits at $6.00 per
case of a nine liter bottle, or its equivalent; cigarettes at $11.00 per carton and carbonated drinks
at a rate of 3 percent plus $1.44 per case, or its equivalent. Items not specifically listed will be
taxed at the “catch-all” rate for other items is four percent, unless an exemption applies.
Contractors doing business in the Virgin Islands on government projects are liable for excise
tax on their imports. For equipment imported under a lease or rental agreement for a period of
180 days or fewer, the excise tax is based on the actual rental charge or on an appropriate arms-
length rental charge.
Payment. Cargo (both foreign and domestic) imported into the Virgin Islands for business
purpose is cleared by the U.S. Customs and Border Protection Service and the BIR. An importer is
required to pay excise tax on cargo to the BIR at the time of entry unless the importer has a
qualifying excise tax bond or rider to its Custom bond. Most merchants have such bond or riders,
which give them until the 15
th
day of the following month to pay the BIR. Payment of the excise
tax is submitted using Form 721V.I., Excise Tax Return.
Exemptions. The importation or manufacture of the following categories of merchandise is
exempt from the V.I. excise tax: certain educational materials including books; most food stuff;
coal; fuel oil; molasses used in the production of rum, animal and poultry feed; commercial
fertilizers; motor vehicles requiring licensing for highway use; goods, merchandise and
commodities brought into the Virgin Islands for disposition in the course of export trade; and