Insular Areas Update

Pursuant to a congressional request, GAO provided information on the fiscal arrangements between the U.S. government and American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, the Commonwealth of Puerto Rico, and the U.S. Virgin Islands. GAO found that: (1) the Internal Revenue Service collected $3.3 billion in taxes from Puerto Rico in fiscal year (FY) 1995; (2) the Bureau of Alcohol, Tobacco, and Firearms collected $232.4 million in excise taxes for rum shipped from Puerto Rico to the United States, and $47.8 million on rum shipped from the U.S. Virgin Islands to the United States; (3) the Treasury transferred $204.9 million and $41.7 million in rum excise tax revenue to the governments of Puerto Rico and the U.S. Virgin Islands; (4) the Customs Service collected $138.2 million in duties from Puerto Rico, of which $96 million was transferred to the Puerto Rican government and $9.2 million in duties from the U.S. Virgin Islands, of which $4.2 million was transferred to the U.S. Virgin Islands government; (5) federal expenditures for the five territories totalled $11.4 billion in FY 1995; and (6) the distribution of federal expenditures for the territories included grants and other payments, as well as salaries and wages for federal employees.