Rum wars NY Times

Yes, I saw this article when it first appeared, VERY informative.

Best,

Islandlola

Thought-provoking to say the least.

Wish we had that kind of local, articulate, watchdog coverage on a consistent basis.

IT

Interesting article.

Although they forgot one thing which I think is a very important part of the debate. The only reason all this nonsense happens is because they tax distilled spirits at such a high rate in the first place. The government is just like the mafia when it comes to alchohol.

The article brings up the fact that the VI offers incentives worth more than the cost of producing rum itself. Stop to think about how the VI can do that and still make money: because the taxes are even higher still than the incentives being offered! The tax on distilled spirits is probably 400%, that is insane!

So the tax law screws the consumer through higher prices (in this case 400% or more higher), the VI government then screws another government to get a big share by giving the consumer's money back to the producer...what a screwed up system! Big business or big government always wins but the "consumer" aka individual people always get screwed! And as usual its due to a tax.

Sean

Well, even with all the free molasses and free distillery the VI "should" get 120 million a year out of it . I think the Governor could have negotiated the deal better, maybe to train the staff so that eventually all employees and management would be VI citizens.
When they start manufacturing the rum will still have to age before it is sold, so any benefit is still a few years out.

That $120 million is best-case scenario based on increasing sales of rum and continuing the rum cover over at its current rate which is subject to the whim of congressional vote. Note that the US farmers are concerned about the deal, so if they protest, congress could very well change the rum rebate program as it's currently written. Also, most alcohol consumption is declining in the States. Tell all your friends and family to drink VI rum exclusively from now on!