THE Saipan Chamber of Commerce favors the Commonwealth Development Authority’s recommendation to grant Tinian Dynasty Hotel and Casino tax abatement privileges for 10 years.
“We do not agree that business owners should be exempted from paying excise tax that they currently pay, but in the case of Dynasty, we do agree that it’s probably the best thing to do here. So we agree with CDA’s recommendation,” Saipan Chamber of Commerce President Richard A. Pierce said in an interview.
Pierce added, however, that “it’s a bitter pill to swallow for businesses to think that they’re going to compete with somebody that doesn’t have to pay the excise tax.”
“But the Chamber believes that in the end, it will prove beneficial if it keeps Dynasty here,” he said.
The Chamber earlier expressed its objection to a proposed measure that seeks to grant excise tax abatement to businesses saying the government desperately needs “every penny it can get its hands on.”
But he said Dynasty qualifies for the qualifying certificate as embodied in the Investment Incentive Act.
He said other businesses that qualify under the rules should also be considered by CDA.
“They should not be discriminated against if they qualify,” he said.
CDA submitted on Wednesday its recommendation on Dynasty’s application for qualifying certificate to the Office of the Governor.
CDA approved a 100 percent tax abatement for Dynasty’s business gross revenue and 50 percent bar tax for the first three years.
A 50 percent tax abatement would be given on the 4th to 7th years, and 30 percent for the 8th to 10th years.
CDA Chairman Juan S. Tenorio described the formula as “fair enough.”
Other businesses like the Hyatt Regency Hotel have also filed their tax abatement applications with CDA.
The Hyatt said it will undertake a major renovation project.
A new water bottling company, SEPC Spring Water, Inc., also applied for the same privileges.
The Investment Incentive Act, or P.L. 12-80, grants tax incentives to tourist-related businesses that invested in the CNMI three years prior to 2000.
It aims to grant up to 100 percent tax rebates/abatement for a maximum of 25 years to qualified investors.
