TABLE 1.-VIRGIN ISLANDS FUNDS RECEIVED BY OPERATION OF FEDERAL LAW AND TOTAL GOVERNMENT REVENUES, FISCAL YEARS 1954-66

deposit fund of income taxes subject to rebate but again it is not clear whether this amount already
is included in, or should be added to, the $210,000. In earlier years, the comptroller's reports show
only the amount of income taxes received by the general fund and therefore at least special deposit
fund receipts of income taxes subject to subsidy may be added to the certified income tax collections
of particular years. There still may be understatement of income tax revenues prior to 1960, notwith-
standing these additions and whatever adjustment for prior years may be contained in the compt
troller's $808,000 escrow of 1960 (as much as $300,000?); the comptroller general in 1959 found tha-
income tax subsidies paid by the Virgin Islands totaled $840,602 during the fiscal years 1952-59 (and
customs duties subsidies $168,654), which totals are considerably larger than the escrowed amounts
identified 1954-59 ($388,400); the omission of 1952-54 data probably does not account for this dis-
crepancy.

Source: Compiled from comptroller, government of the Virgin Islands and Office of Territories reports as indicated in numbered footnotes attached.
1 Income tax: Income taxes certified for matching by the Government comptroller appear to be the
most reliable series available; 1954-58 are shown in comptroller's annual report 1958; 1959-63 in
comptroller's annual report 1963; 1964-66 from comptroller's certification of net revenues in respec-
tive fiscal years. On the basis of a Dec. 4, 1959, opinion of the associate solicitor for territories, a change
was made in the method of computing taxes certified for matching. The 1960 certification of net
revenues states that income tax subsidies paid have been included in income taxes certified and that
collections subject to subsidy, and deposited in the special deposit fund, have not been, as in prior
years, excluded. Since the 1960 figure for income taxes in special deposit is very substantially larger
than the 1961 figure, it is possible that 1960 certified revenues include some income taxes collected but
not certified for matching in years prior to 1960. The comptroller general's report of fiscal 1960 states
that a supplemental report will be made as to any amounts excluded from certification in prior years,
but revised figures are not shown in the 1963 summary of prior certifications. In 1960 and later years,
Virgin Islands internal revenue collections have consistently exceeded the amount of Federal funds
available for matching, in any event.

It is not entirely clear, from the 1956-59 reports, exactly what income taxes subject to subsidy were
not certified for matching in those years. The 1959 certification (as indicated by the comptroller's
annual report) included in certified revenues a $210,000 transfer from special deposit (subsidy)
funds; the comptroller's report on department of finance accounts shows an $84,820 receipt in special

Income taxes certified for matching do not include ordinary income tax refunds (i.e., refunds not
associated with the tax subsidy program). Until now, the Virgin Islands government has included
such refunds as both income and expense items. In some, but not all years, the amount of the comp-
troller's adjustment for refunds can be identified; when not identified as such, it is assumed that
refunds account for the discrepancy between Virgin Islands government and comptroller reports of

(Footnotes continued on p. 729)

income tax collections, provided also both the comptroller and the Virgin Islands government have
reported the sum of income tax collections subject to tax subsidies. When tax subsidies are so identi-
fied, the tax refund discrepancy amounts to $740,134, 1966; $608,770, 1965; $331,419, 1964; $365,671,
1963; $213,568, 1962; $509,576, 1961; $345,234, 1960.

2 Customs duties: Comptroller's annual certification of net revenues 1960-66 identifies amount of
customs du ies collected in each year, and 1960 certification gives a customs duties total for 1959.
The certifications of 1960 and 1962 do not indicate any deposit of customs duties in special deposit
account, pending refund under the tax subsidy program. Since the tax incentive program was in
effect before and after each of these years, it seems likely that the amount reserved for subsidy
simply was included in general fund deposits by the comptroller, or that the amount of customs
duties collections is understated in 1960 and 1962, or that the 1960 reservation of customs duties
for subsidy payment was included in the large "income tax" subsidy escrow amount for 1960.

The $52,000 reserved for customs duties subsidies in 1959 appears as a deduction in the 1959 certi-
fication and is added herein to the collection of customs duties in 1959 as shown in the 1960 certifica-
tion. A check of the total category reported under trade and excise taxes 1959 and 1960 indicates
that the $52,000 was not included in trade and excise taxes, including customs duties, certified in
1959.

Certifications prior to 1959 do not identify customs duties, which must be taken from the data pre-
sented in the annual report of the Governor of the Virgin Islands to the Secretary of the Interior
fiscal year 1959. These figures may be estimates. The amount reserved for subsidies is shown in the
comptroller's certification of net revenues, 1958, although customs duties collected are not separately
identified. As indicated above, customs duties subsidies paid 1952-59 totaled $168,654 as compared
to $104,300 identified herein as amounts escrowed 1954-59.

3 Immigration fees: Immigration and passport fees are separately reported by the comptroller in
certifications for fiscal years 1959 through 1963; special report of comptroller identifies such fees,
1964-66. The Virgin Islands Department of Finance annual reports for 1957 and 1958 permit identifi-
cation of immigration and passport fees in those years. 1954-56 immigration fees are assumed to
have been negligible, i.e., less than $20,000.

Matching funds, from Office of Territories data; similar data also are shown in comptroller's
annual reports or Virgin Islands Department of Finance annual reports. Matching funds are U.S.
internal revenue taxes collected on Virgin Islands products (mainly rum) upon entry into the United
States; the taxes collected in 1 year, net of costs of collection, are returned to the Virgin Islands in
the next fiscal year, provided the Virgin Islands has collected, and the comptroller has certified,
revenues of matching amount (26 U.S.C. 7652(b)). The statute does not require that revenues eligible
for matching shall be revenues derived by operation of local law; therefore income taxes, customs
duties, and immigration fees collected in the Virgin Islands, as well as the locally imposed taxes and
fees shown on table 2, are considered for purposes of matching. Appropriated grants from Office of
Territories compilation of appropriations.

Virgin Islands Department of Finance annual reports 1966 and 1964 for Federal grants-in-aid
1960-66. Comptroller's annual reports 1956-59 for Federal grants in these years. 1954 and 1955
Federal grants are estimated to fall between a 1953 Virgin Islands government report of $413,400 in
Federal grants of that year and the $536,400 in Federal grants reported by the comptroller in 1956.
Estimated figure.

8 Total operating revenues: 1964-66, Virgin Islands Department of Finance, annual report, standard
government operating revenues, including revenues of general, matching, essential projects and
special funds minus, in 1966, $498,079 in transfer of funds to general fund, and minus refund dis-
crepancy between Virgin Islands reported income tax collection, general fund, and comptroller's
report, which amounted to $740,134 in 1966, $608,770 in 1965, and $331,419 in 1964. 1960-63, Virgin
Islands Department of Finance, annual report, total receipts of general, matching, essential projects
and special funds minus interfund transfers and minus refund of income tax discrepancy between
Virgin Islands and comptroller's report, which discrepancy amounted to $365,671 in 1963, $213,568 in
1962, $509,576 in 1961, and $345,234 in 1960; for comparability with later year reports, revenue items
not deposited in the foregoing funds are added, such as customs duties, unemployment compensation
collections, tax subsidies in escrow (per figure reported in comptroller's certification of net revenues)
Omitted from the 1960 figure are proceeds of sale of the telephone system. 1959, comptroller's annual
report, total Virgin Islands government receipts (including service charges not certified for matching).
minus $132,896 in nonmatching income tax receipts plus Federal matching funds. 1958, comptroller's
annual report, government receipts (including service charges, not including income tax refunds)
plus gasoline taxes, Federal grants, Federal matching funds and $166,000 in income taxes subject
to subsidy, as shown in special deposit fund income statement. 1957, net revenues certified for
matching in 1957, per comptroller's annual report for 1958, plus comptroller's figures in 1957 annual
report for service income, income from use of money or property, Federal grants, Federal matching
funds, deposits of income taxes subject to subsidy. 1954-56 figures are incomplete, and partly esti-
mated, representing the sum of revenues received by operation of Federal law (with estimates for
Federal grants in 1954-55) and revenues received by operation of local law (including estimates
of local government service revenues in 1954-55).

After exclusion of unemployment compensation contributions of; in thousands of dollars, $834.2
in 1966, $670.6 in 1965, $524.5 in 1964; $432.3 in 1963, and $82.6 in 1962.

10 1956 revenues received by operation of local law include only general fund receipts-a figure
which excludes Federal grantsjandjmatching funds-per comptroller's annual report for 1956, minus
income taxes and customsduties shown above. Immigration fees and some income tax refunds
may be included in local revenues so derived.

11 Net revenues certified for matching, 1954-55, as reported by comptroller in 1958 annual report,
minus income taxes and customs duties shown above, plus an estimated $200,000 in government
service income. In 1956, comptroller reported $216,144 in government service income. Immigration
fees, presumably a small amount, thus will be included in local revenues.

1966

1965

1964

1963

1962

1961

1960

1959

1958

1957

1956

1955

1954

TABLE 2.-VIRGIN ISLANDS REVENUES RECEIVED BY OPERATION OF LOCAL LAW, IN TOTAL AND IN CATEGORIES, ELIGIBLE FOR MATCHING BY FEDERAL FUNDS FOR FISCAL YEARS 1954-66

[In thousands of dollars]

Source: Government Comptroller of the Virgin Islands, certification of net revenues, 1960-66, Comptroller's Annual Report, 1963, comparative statement of net revenues certified 1954-63, unless otherwise indicated.

1 Comptroller's certification of net revenues, 1958, trade and excise taxes plus $52,290 in "non-
taxable subsidies" (i.e., customs duties subject to subsidies) minus total of customs duties collected,
as estimated in the Governor of the Virgin Islands annual report to the Secretary of the Interior,
1959.

2 Comptroller's annual report 1963, comparative statement on net revenues certified, "trade and
excise taxes" 1954 57, minus total of customs duties collected, as estimated in the Governor of the
Virgin Islands annual report to the Secretary of the Interior, 1959. No adjustment is made for customs
duties subject to subsidy; the discrepancy between trade and excise taxes certified for matching
by the Comptroller and the trade and excise tax total reported in the Comptroller's annual report
for 1956 and 1957 is minor and may represent customs duties refunds rather than subsidies.
* Not reported separately; possibly included with gasoline taxes.

• Excluding Federal immigration and passport fees, 1964-66, per Comptroller's special report, but including such Federal fees 1954-56. In 1957, such fees amounted to $19,500.

3 Comptroller's annual report, 1965, comparative statement of net revenues certified, licenses, fees, permits" 1957 and 1958, minus immigration and passport fees reported in Virgin Islands annual reports, 1957 and 1958.

• See table 1.

7 After exclusion of unemployment compensation contributions, collected 1962 66.

8 Including certain revenues derived by operation of Federal law; namely income taxes, customs duties, immigration and passport fees.

Including small amounts of income from use of money and property, ranging from $100 in 1960 to just under $700 in 1956.

TABLE 3.-DIRECT FEDERAL APPROPRIATIONS, VIRGIN ISLANDS AND GUAM, FISCAL YEARS 1950-67

1 Not including appropriated grants, Virgin Islands $745,000 per year, 1950-54, $400,000 in 1955 (1954-55 appropriated grants appear in table 1); Guam, $1,250,000 in 1951 and agricultural assistance, Virgin Islands $49,507 in 1950, $50,890 in 1951, $50,386 in 1952.

2 Organic Act provision concerning Federal reimbursement of travel expenses for stateside personnel. Appropriations for this purpose were not requested in succeeding years.

3 Including $41,330 for Chief Justice and High Court. Expenses of Federal courts in Guam and Virgin Islands otherwise covered by Department of Justice appropriations.

* Funds appropriated before enactment of Public Law 89-98 and Public Law 89-100, which repeal Organic Act provisions concerning Federal payment of legislative salaries.

Source: Office of Territories compilation, based on departmental appropriations.

TABLE 4.-FEDERAL AID PAYMENTS TO VIRGIN ISLANDS GOVERNMENT AND PUBLIC INSTITUTIONS BY FISCAL YEARS