Monday, Nov. 03, 2008

$192 Million for U.S. Territories' Rum Industries

Another product of the pork-stuffed economic bailout bill, this earmark slipped into the Senate version of the legislation renews an expired rebate against excise taxes charged on rum imported from Puerto Rico and the U.S. Virgin Islands until the end of 2009. The provision was mocked during a subsequent debate in the House by Democrat Marcy Kaptur of Ohio, saying, "So we got tax breaks for rum. You've got it right. R-U-M." But it still passed — and the criticism that followed in the media fired up lobbyists from Bacardi and Captain Morgan, the two most popular rum brands in the U.S., who said they aren't seeing any of this money. The $192 million in tax cuts mostly go to the two territories to help them build up their economies and, in theory, keep them from needing larger financial handouts from the mainland. But then again, this practice isn't new. For decades, Congress has been giving the two territories this precise tax cut. And if it hadn't been part of this controversial bailout this time around, it might have once again gone unnoticed.