GOVERNOR Arnold I. Palacios on Friday signed into law two bills that will impose taxes on construction projects with a revenue threshold of $350,000.
Authored by Speaker Edmund S. Villagomez, House Bill 23-120, which is now Public Law 23-31, imposes a 3% surtax on gross revenue derived from non-residential construction projects that cost $350,000 or more.
The new law exempts revenue from contracts awarded on or before Jan. 15, 2025. The tax applies to any and all qualifying construction projects arising from contracts awarded or executed on or after Jan. 16, 2025.
The 3% construction surtax will be deposited into the general fund, except for 10%, which will be deposited into the Gross Revenue Qualifying Construction Project Account, 20% of which will be appropriated as follows:
–2.5% for the First and Second Senatorial Districts or Rota and Tinian.
–15% for the Third Senatorial District or Saipan and the Northern Islands.
Of the 80% of surtax collection that will be appropriated for road maintenance, solid waste and environmental protection purposes, 15% will go to the First and Second Senatorial Districts, and 50% will be allocated for the Third Senatorial District.
The governor also signed House Local Bill 23-60, which imposes a 1% tax on the yearly gross revenue of construction activities in excess of $350,000.
Authored by Rep. Ralph N. Yumul, H.L.B. 23-60 is now Saipan Local Law 23-24.
Like P.L. 23-31, it also exempts gross revenue from the construction of residential housing, which refers to “individual homes, and not apartments or similar activities.”
Other bills signed
The governor also approved Senate Bill 23-67, which aims to address the shortage of primary care doctors in the CNMI.
Authored by Senate Vice President Donald M. Manglona, the bill, which is now Public Law 23-33, allows the Health Care Professions Licensing Board to promulgate rules for the licensing of foreign physicians.
The governor likewise signed S.B. 23-17, which prohibits the Department of Public Lands from revoking an approved village or agricultural homestead permit.
Authored by Sen. Frank Q. Cruz, the bill is now P.L. 23-34.
In addition, the governor approved S.B. 23-54, which will regulate afok or bweesch (lime) under Pure Food and Drug Control Act.
Authored by Senate Floor Leader Corina Magofna, the bill, which is now P.L. 23-32, aims to “continue to safeguard the CNMI’s natural resources and protect consumers by establishing guidelines on the manufacturing, distribution and sale of afok or lime under the Pure Food and Drug Control Act.”
The new law requires manufacturers to include in the product a warning label that reads, “This product may be linked to oral cancer.”
In a statement to the media, the governor extended his gratitude to lawmakers, commending their “dedication and perseverance in advancing these impactful initiatives.” He also expressed his eagerness to “continue working with them to address the needs of the CNMI.”
Gov. Arnold I. Palacios on Friday signed five bills into law.
