Benavente, R-Saipan, said he support the tax break program because it helps the CNMI economy but Palacios said the commonwealth is too broke to be generous.
In an interview on Tuesday, Benavente said it is important to have something that will help stimulate the economy.
The QC program, he added, is “supposed to go beyond” taxes.
He said every company that received tax breaks has contributed to the CNMI economy.
Benavente said these included Sand Castle and Hard Rock Café.
Their existence on Saipan “enhances” the local tourism industry, he added.
The QC provided to Laolao Bay Golf Resort also benefited the CNMI because of the resort’s ties with Asiana Airlines, he said.
According to Benavente, the CNMI government has turned down QC applications of companies that have not contributed to the commonwealth economy.
Palacios, in an email, said the commonwealth is “not going forward with this type of generosity,” referring to the QC program.
He said if the governor is going to approve another QC application, “then he must also make adjustments for the shortfall in his projected revenue collections.”
“If we have the money to spare, by all means, let’s give them a (tax) break, but the truth of the matter is, the CNMI government is broke. We cannot even pay our employees on time. Their hour has been reduced from 80 to 64, the vendors are crying, the buying power of our people is reflected in the reduced revenue of businesses. The bottom-line is, if the government can afford it, grant it. If not, then you be the judge,” said Palacios, R-Saipan.
Palacios was reacting to the QC application of Sandy Beach Homes in Chalan Kanoa.
He said the Commonwealth Development Authority, which manages the QC program, should also come up with a “realistic scenario” of the CNMI’s current financial condition.
