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Subsidies spike Puerto Rican rum war
Captain Morgan of Captain Morgan rum fame.
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Steve Chiotakis: The alcoholic beverage rum conjures up images of pirate boats and the high seas. But it's not that much of a stretch these days. The $12 billion industry is giving "rum wars" new meaning. Christopher Werth reports.
Captain Morgan Ad: They've got a little captain in them, get a little captain in you. Drink responsibly.
Christopher Werth: Puerto Rico has a lot of captain in it. It's currently home to Captain Morgan, and its rum rival Bacardi. And because the U.S. sends most of the taxes it collects on the sale of rum
back to where it was produced, it's thought Puerto Rico receives roughly $400 million in tax rebates for the honor.
But the U.S. Virgin Islands is luring Diageo with $2.7 billion in subsidies and tax breaks. A move Bacardi says is unfair.
Richard Murphy of the U.K. firm Tax Research says it's not that Bacardi doesn't like subsidies:
Richard Murphy: What they don't like is the fact that Diageo may get a very much bigger subsidy than any that Bacardi have enjoyed to date.
Both Puerto Rico and Bacardi would like to see Congress limit how much of those tax breaks can go towards subsidies. For its part, Diageo accuses Bacardi of trying to push it out of the U.S.
I'm Christopher Werth for Marketplace.
Friends. let me open your eyes. Virgin islands going to give the 50% of the return taxes to Diageo, in Puerto Rico they have a law that regulates that, they only give a 10% to the captain Morgan maker serralles an the other 90% they uses for education, health, promote economy and jobs. review the deal with Virgin Islands again and read. The numbers don't fail.
well i my opinion that deal is a public-private deal. using money of all us tax payers. that means that every tax payer pay the production of an alcoholic beverage.we wan for our kids a good future preventing them from tobacco,drugs, alcohol that's the message. and now we are going to use taxes to pay the elaboration of captain Morgan. CONGRESS STOP THAT THAT'S NOT FAIR. TAXES ARE USE TO PROMOTE ECONOMY, HEALTH, EDUCATION. IF YOU WANT TO HELP AND INDUSTRY, HELP A INDUSTRY OF SOMETHING WHO PROMOTE HEALTH, EDUCATION, FOOD, SMALL BUSINESS. BUT NOT ALCOHOLIC, TOBACCO OR INDUSTRIES THAT PROMOTE BAD FUTURE FOR OUR PEOPLE. THAT DEAL IS A BRIDGE FOR CORRUPTION. THINK ABOUT IT.
The taxes collected from the production of rum is going BACK to the US territories where they were produced. Since territories cannot get the same federal money as states, this money is to let the territories build their economies. Puerto Rico's government does not know how to handle business and chased many companies away in the last few years. Capt. Morgan was going to take its jobs out of the country. The US Virgin Islands asked then to St. Croix and preserving US jobs. Puerto Rico does not want to see some of $400 billion go to another territory. It is like the husband abusing the wife. When she gets out of the house he tries to kill her and her new love interest. If I can't have you no one can. Several reports came out saying it is a brilliant deal to boost the economy.
