Excise Tax on Used Personal Items

You are required to pay the 4% tax on any items new or used brought into the USVI. If the items were not manufactured in the US you will also be required to pay duties depending on the type of goods and the country or origin.

Be careful in setting the shipment's value. If you claim a value of less than the cost of shipping you may have to explain in great and time consuming detail to the authorities why you would for example pay $2,000 to ship goods to the VI that have a nominal value of say less than $500?

The only way around this is to make smaller shipments with a value of under $1,000 using the US Mail. Won't work for furniture or items weighing more than 70lbs, but for everything else it is the way to go.

I know it seems unfair, but is no different than shipping things to Canada. When my kids went to go to summer camp in Ontario and I shipped their foot lockers up by UPS, I had to pay duties on their clothes.

Jim

The topic is indeed murky. This is what I've been able to find out...

According to USVI.net:

Articles imported into the U.S. Virgin Islands for use or resale in a trade or business are subject to an excise tax. Because the USVI is outside the U.S. customs zone, foreign (non-U.S.) made goods are also subject to a customs duty which is separate from the U.S. customs duty. The rate of excise tax on most goods is 4%, while the rate on certain products, such as cigarettes, is higher. Alcoholic beverages are subject to a flat rate based on volume. Certain other goods are subject to a lower rate of excise tax, and most tourist items, such as jewelry, watches, crystal, artwork, electronic goods, and leather goods, are exempt entirely. Tourist items are also exempt from the 6% U.S. Virgin Islands customs duty.

People exiting the USVI have a $1200 personal exemption, which I assume would apply to people arriving on the USVI as well?

According to this realtor's site:

1993 - Government imposed a 4% excise tax on imported personal goods (large appliances and furniture) valued at $500.00 or more.

According to this site, you can claim used items as such by marking them as "American Goods Returned", however they still calculate against your total 30 day exemption, which is $400. This only includes items in your possession.

Unfortuantely, this is not a lot of help. It's still confusing. I think the best thing to do is to write or call the VI Bureau of Internal Revenue and ask them for specific advice:

V.I. Bureau of Internal Revenue
9601 Estate Thomas
Charlotte Amalie
St. Thomas, V.I. 00802

Phone: (340) 774-5865
Fax: (340) 776-4037

Thanks for the very detailed info Jim Dandy and Smartbomb.

The suggestion to use the USPS to ship certain items is particularly helpful. I think I will try to mail as many things as I possibly can.

Thanks again 🙂

Hello,

Not an expert on this field but going to give a go at explaining...

It seems like some terms are getting mixed up and therefore making this more confusing.

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Mell asked about Excise Tax on Personal Items... this tax is actually called Personal use Tax rather than Excise Tax (which is for businesses importing goods for resale as far as I understand).

Personal Use Tax is paid to the Excise Tax office. When I had called the Excise Tax office in mid-2004, they did not mention any exceptions on 'used' personal items in fact when I asked what about items that were already owned... they said to itemize the contents being shipped and put an estimated price for each item.

Personal Use Tax Formula: Mell wrote "I would pay a 4% tax of the value of my items for any shipment over $1000" which is not quite correct. The formula I was given when I had called was:

Total Amount of Shipment or Packing List minus $1000 times 4%.

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Smartbomb, the information you looked up is not Personal Use Tax but rather Excise Tax and Duty Free Allowances...

The first & third quote you gave is for Excise Tax which applies to businesses importing goods. Individuals are charged Personal Use Tax.

The second & fourth quote is for visitors to the USVI/Tourists; the duty free allowance is $1200 along with other specifications on gifts, mailing things home, alcohol... when returning home to the US Mainland.

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I am reposting an old message with info. on the Personal Use Tax, it is from May 2004.

"I called the Excise Tax office and asked some questions concerning the Personal Tax.

I asked whether it was imposed on all shipments (business and personal)

ANS - NO the tax is Personal - it is charged only to individuals. Businesses already have their own taxes to pay separate from this Personal Tax.

Is it imposed only on items brought in via barge?

Ans -No its imposed on all items brought in for personal use.

How would you collect taxes on items shipped through the postal service? Is there a new form that goes with packages and will the post office collect on your behalf similar to customs fees?

Ans - No the recipient has an obligation to come in to our office and say they received items by mail that are taxable and pay the tax.

How do you determine the tax? If I was to order an expensive item and had it mailed to me and I ordered from another company 20 items each less then $1000 but invoice totally more then $1000 - what would be taxable?

Ans - You are taxed per invoice not per item. So if an invoice for one item is $999 - there is no tax. If an invoice for 40 items is $1500 you are taxed on the invoice regardless of if the items within the package are all nominally priced.

What about people shipping all their household items that they already owned, things like coffee makers, rugs, cloths ect. - that are all likely less then $100 but all together could be several thousand in value?

Ans - for people shipping large quantities of items you must have a packing list, with the packing list an estimated value for each item and a total for all packed items - the tax will be imposed on the total of the packing list for the container of items shipped not an each item."

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I would encourage calling the Excise Tax office to confirm the above information and to ask further questions you might have in regard to the items you might be shipping & the Personal Use Tax.

Hope that helps.

--Islander

Thank you for the additional information Islander 🙂

Personal Use Tax Formula: Mell wrote "I would pay a 4% tax of the value of my items for any shipment over $1000" which is not quite correct. The formula I was given when I had called was:

Total Amount of Shipment or Packing List minus $1000 times 4%

So let me see if I understand - if the total shipment amount is $500, then there is no tax. If the total shipment amount is $1800, the taxable portion is $800, thus the tax is $32.

When calculating the value of goods, do you use their actual value or their replacement value? I may have a toaster oven that costs $50 to replace but has an actual value of $5 if I was to sell it, say at a flea market.

Does the personal use tax also apply to boats and cars that are brought down to the USVI, and if so, does it use the same formula?

When I shipped things here, my bill of lading with Tropical Shipping showed what was in the pallets of boxes. For declared value, I was instructed to put the "garage sale or flea market value", rather than the replacement value. They also said if I wanted to insure the shipment, I could insure it at the replacement cost value. By declaring the typical resale value of used household goods, you might avoid any tax,depending on how much you ship all together. If you break up your belongings into multiple shipments, calculate first whether the added shipping costs are greater than the tax. It might cost you more to avoid the tax!

Perhaps you can help clarify shipping via USPS. If I send 40 boxes- each containing less than $1000 of used goods each- then I would not have to pay tax on them? Does each box count as a container/separate shipment or would the entire shipment of boxes (via USPS) be invoiced together?

with USPS, they look at the value of contents in each separate box. Many people use this method to avoid tax if they are shipping a number of separate items that each (or each group) are valued at less than $1K.

My fiance and I shipped some new furniture/household items from Costco on San Juan last summer. We had purchased them separately (his receipt and my receipt - each totaling less than $1K), but the shipping company chose to shrink wrap them together on one pallet when Costco delivered the items to the loading dock. Consequently we got charged tax upon arrival that we had not expected and probably should not have had to pay. Live and learn.

Hello Mell,

I have been working with Lee Fleming with Managed Freight to coordinate my move to STX. I had asked him this same question.

His answer:
You will pay 4% tax on any item that is less than a year old. There is a form where these items need to be listed and, of course, they prefer a receipt to determine the value, if there is no receipt an estimate of the resale value is used. There is no tax on personal items more than a year old.

You can reach Lee Fleming directly if you have more specific questions. I have found him very patient with my many questions.

toll free : 888-820-8475
email : info@managedfreight.com
Yahoo IM : MANAGED340

I hope this helps.

Regards,
Dante

Then it seems that unless you ship in a container full of brand new items still in their original packaging, most of what you ship as used household goods shouldn't raise any eyebrows or result in a tax bill.

That's what they tell me...We will see what happen when I actually ship my items 🙂

Hi Dante,

Thank you so much for the information. That was extremely helpful 🙂 ! I will contact Lee in the morning.

Best,
Mell