Southern Trust received a 90% exemption on its US VI income taxes and a 100% exemption on gross receipts and excise taxes for a decade starting in February 2013, according to its filing with the island.

The economic development tax breaks can go even further for Virgin Islands residents, with a 90% reduction in personal income tax also available.

“The USVI is unique in that it has congressionally approved tax benefits found in the Internal Revenue code, but at the same time, the American flag flies, there’s a U.S. federal court, appeals go to the U.S. Third Circuit, you’re not outside the U.S. banking system and you even have a U.S. area code,” said Joseph DiRuzzo, a long-time USVI tax attorney.

“It provides all the accouterments of the U.S., with some of the tax benefits that one would typically only see offshore,” he said.

Residency Rules
It’s not clear whether Epstein -- who owns a Manhattan townhouse, a Florida villa, a New Mexico ranch and an apartment in Paris in addition to two private islands off St. Thomas -- was ever a USVI resident.

Typically a taxpayer must spend at least 183 days a year on the islands. Flight records provided by JetTrack suggest Epstein spent just 56 days in the region in 2017 and 13 in 2018. A former employee who spoke on the condition of anonymity said Epstein always traveled to his island via private jet.

If Epstein moved around between his properties, mostly those outside the Virgin Islands, Southern Trust was putting down roots. To secure its tax status, Epstein agreed to invest more than $400,000 in the business and to employ 10 full-time employees by the end of its sixth year of operation, 80% of whom had to be Virgin Island residents.

What the company does is unclear. The EDC certificate describes it as “providing an extensive DNA database and to develop a data-mining platform.”

Just a Little Sign
There’s little sign of the company’s local presence at the commercial plaza on St. Thomas, featuring a Sami’s Mini-Mart and the Happy Nails salon, where its office is registered. Its name is listed only on a dockside building directory. It doesn’t appear to have a website.

The last compliance review was completed in November, according to Kamal Latham, chief executive officer of the jurisdiction’s Economic Development Authority, and Southern Trust was found to be within the law.