“With one entity such as the Department of Commerce having absolute authority without…any checks and balances in the review process things can go ugly just as how things had gone ugly with the investor program in the early days of its implementation under the AG’s immigration office,” he said in an e-mail to lawmakers.
Camacho, who is also CDA’s loan officer, doubts if the bill, H.B. 16-172, can be successfully implemented.
The bill was introduced by Rep. Joseph C. Reyes, R-Saipan.
It aims to provide three-year tax rebates to new investors who will infuse a minimum of $5 million investment into the islands.
According to Camacho, under the bill, “The governor’s office will have a free hand at the program and there will not be any accountability. There are many testimonials to this from previous administrations. I am not suggesting that new administrations are going to repeat the same mistakes, but only saying that every body is vulnerable when one has the absolute authority to decide.”
He posed the following questions to lawmakers:
• “What is to stop existing businesses from simply closing shop today and start up tomorrow as a new business and qualify? (there goes the erosion of the tax base)”;
• “How long is the review and qualifying process?”
• “What qualifies as investment? Anybody can claim investment valuation at, say, $5 million. The threshold seems small enough to be manipulated/molested and stretched to fit one’s claim as long as the pressure is strong enough. It does not matter whether an investment was $50,000 or $5,000,000 when the right connections are strong it will get the benefit and there will not be anyone accountable.”
Camacho said there is no need for the legislation.
“The administration can simply designate the Commerce secretary as the governor’s official representative to the CDA board meetings for [qualifying certificate] purposes and act as its liaison officer. This will work out rather more quickly and expediently than for the department to hire the AG to come up with regulations which might be opposed and never materialize.”
Camacho said he’s not against the proposed incentive program, but “we need inducements to bring in investors; we do not need any more duplications and regulations.”
The QC program provides tax breaks to qualified investors.
