KOROR (Palau Horizon) – THE House of Delegates Committee on Ways and Means concluded this week the series of public hearings on the proposed Fiscal Year 2011 budget bystating that the House version will approve some of the recommended new taxes by the government.
Committee chair Del. Sechilil Eldebechel in an interview said that members ofthe committeeare now putting together a committee report which is expected to be reported out next weekatthe start of the Olbiil Era Kelulau regular session.
President Johnson Toribiong’s financial package for FY 2011 proposes salary cuts for government officials and new form of taxes to raise additional revenues.
The proposal calls for a spending ceiling of $54.2 million, of which $36 million is derived from locally generated funds with the remaining $18.25 to come from Compact assistance, including the Compact Trust Fund.
Toribiong also proposed to increase anew hotel room tax from 10 to 15 percent, collect departure tax of $20 from Palauan citizens, increase import tax on foodstuffs, additional tax on divers and raise taxes collected from employees earning $25,000 or more a year.
Eldebechel in an interview said the committee members are considering the passage of the increase in hotel room tax, increase in import tax on foodstuffs and raise on taxes collected from earning $25,000 or more a year.
The president wants the salaries cut by 10 percent which will only be implemented for a year to save $195,000 in revenues.
“This is a shortsighted policy, a one year cut doesn’t solve anything,” he noted.
The proposal calls for a spending ceiling of $54.2 million, of which $36 million is derived from locally generated funds with the remaining $18.25 to come from Compact assistance, including the Compact Trust Fund.
The proposed budget also recommends a 10 percent reduction in salary for the President, the Vice President, Ministers and the 29 members of the Olbiil Era Kelulau.
In the FY2010 supplemental budget, the salaries of the president, vice president and ministers were raised. The combined pay hike is over $100,000.
The delegate said the committee will make sure that the budget is a balanced one and make sure that cuts or increases of agencies budget will not undermine the work that these entities perform.
