GOVERNOR Arnold I. Palacios, in his annual report last week to the Legislature, said the CNMI government collected $4.9 million more than what was projected in fiscal year 2024.
Excise tax collections, however, fell short of projections by $16.5 million.
In Public Law 23-9, or the FY 2024 Appropriation Act, the government projected $163.4 million in revenue collection in the fiscal year.
In his FY 2024 annual report to Senate President Edith Deleon Guerrero and Speaker Edmund S. Villagomez on Dec. 31, 2024, the governor said the CNMI government’s actual revenue collection was $168.3 million.
He attributed the $4.9 million additional revenue mostly to an increase in income and business gross revenue taxes.
Citing the report of Finance Secretary Tracy B. Norita, the governor said 66% of the total tax collections in FY 2024 originated from income taxes. The income tax subcategory of BGRT represented 44% or $74.6 million in actual collections, exceeding the budgetary projections by $11.9 million, the report said.
Palacios said this increase in tax collections “resulted from commercial activities” with retail, construction and financial institutions being the top three contributing business sectors, making up 50% of all total BGRT collections across all businesses.
Finance also reported that collections from the wage and salary tax amounted to approximately $30 million; from the corporate tax, $3.5 million; and from the individual income tax, $3.5 million, “exceeding the projections by $1.8 million and $1.8 million respectively.”
However, the report said, excise tax collections fell short of projections by $16.5 million. The government’s excise tax projection in FY 2024 was $39.7 million, but the actual collection amounted to $23.2 million only.
On Tinian, the governor said Customs collection “saw an impressive 68.27% increase in revenue collection in FY 2024, compared to FY 2023.”
He said, “This significant growth is primarily attributed to the military buildup on island, which has resulted in increased import activities at the ports of entry.”
Tourism
As for the islands’ primary industry, tourism, the governor cited the Marianas Visitors Authority’s report indicating that arrivals increased by 22% in FY 2024 compared to FY 2023, reaching a total of 237,498 visitors.
The Saipan Chamber of Commerce has said that annual arrivals of at least 500,000 visitors will allow the tourism sector to “break even.”
In FY 2024, Palacios said total visitor arrivals recovered to 44% of pre-Covid FY 2019 levels. According to MVA, visitor arrivals in 2019 totaled 487,008.
He said in FY 2024, the visitor market share was dominated by Korea, accounting for 75% of arrivals. China and Hong Kong, he added, combined for 7%, while Japan, U.S. and Guam each contributed 5%.
Since the onset of the pandemic in 2020, there have been no direct flights to Saipan from mainland China.
Expenditures
In his report, the governor said that after debt service payments and earmarked funds, the remaining resources for FY 2024 totaled $111.9 million. This total was equal to the remaining resources appropriated for the fiscal year, he added.
Original projection
For FY 2024, the governor originally projected $172.5 million in budgetary resources. This amount was later reduced by lawmakers to $163.4 million.
On Aug. 1, 2024, the governor announced a proportionate budget reduction. He cited Finance’s third quarter report indicating that as of June 30, 2024, the actual gross revenue collections of $120.5 million was 3% less than the forecast.
