THE 17th Saipan and Northern Islands Municipal Council is offering alternatives to the tax hike measures introduced in the 23rd Legislature.
In her letter to Senate Vice President Donald Manglona, who chairs the Senate Fiscal Affairs Committee that is currently conducting public hearings on the measures, the municipal council chairwoman, Marian DLG Tudela, said the Legislature should instead “explore … investment-friendly options in attracting new business entries to the Commonwealth.”
“Perhaps, the Legislature needs to pay more attention to examining existing statutes in order to provide for alternative revenue enhancements internally, such as those recommended in the 2020 Economic Summit by the past administration,” Tudela said.
Rather than passing tax hike bills, she said lawmakers should revisit the existing laws on education tax credit, tax rebates, luxury taxes, real estate transfer tax, fuel exemption tax and the tax on recipients of federal grants such as the beneficiaries of the Building Optimism, Opportunities, and Stability Together program.
Tudela said the council encourages “greater focus and effort by the Legislature in allowing each senatorial district to calibrate its own rules and make an independent assessment on the feasibility and advisability in crafting … policies to attract new businesses to their shores. That is, Tinian and Rota should be allowed to provide a mix of incentives that should serve as business havens for U.S. businesses, including anchor businesses for investments to Asia.”
For instance, Tudela said, Rota could offer “paradise living” for neighboring residents of Guam in high-rise condominiums. In addition, “elderly care center may be an option for Rota’s tranquil environment, or for that matter, re-designate the Wedding Cake Rock Island of Rota for a special district investment and an opportunity for investors to stay longer on Rota.”
On Tinian, Tudela said the former Tinian Dynasty Casino-Hotel can be converted into condominium housing for the military.
For its part, Aguigan island can be transformed into an exclusive “Las Vegas or Macau of the Marianas” special economic and business district, she added.
Tudela said, “The post-Covid-19 Legislature needs to think outside the box in crafting public policies that are unique and effective in a small business environment.”
The council’s recommendations, she said, are “by no means exhaustive and may be improved with others not mentioned. In other words, it behooves on the 23rd Legislature to revisit some of the existing revenue-generating policies….”
Tudela said the overriding question is “what are the potential effects of taxes on the economy in the short run and long run?”
She said the 23rd Legislature’s approach to revenue generation via tax hike measures “is hardly synonymous with the creation of wealth through attracting new investment activities, or for that matter, retaining existing investments.”
