Senate Vice President Jude U. Hofschneider, R-Tinian, said their original intent in forming an ad-hoc committee was to come up with the “best” proposal to increase taxes and fees.
But during initial meetings with government agencies such as the Department of Finance and the Department of Commerce, they realized that the government’s cash flow problem is caused by lack of proper enforcement of existing tax laws, Hofschneider said.
This is why the Senate created a Tax Policy and Enforcement Review Committee, he added.
Hofschneider said if existing tax laws are fully implemented, perhaps there will be no need to increase taxes.
“The statutes are there. All we need is to step up the enforcement aspect of it. So what we learned from these agencies is that there are statutes already in the book that need to be revisited,” Hofschneider said.
During yesterday’s public hearing in the Senate chamber, Saipan Chamber of Commerce executive director Kyle L. Calabrese agreed that the Legislature should first address ill-enforced tax laws before considering a tax or fee hike.
Most businesses, especially those that obey the law sympathize with the government’s cash flow problems, which are due to lack of enforcement, Calabrese said.
Senate President Paul A. Manglona, Ind.-Rota, noted that while they are trying to improve tax enforcement, the Division of Revenue and Taxation lacks personnel and has no director since Estrelita Ada resigned earlier this year.
Joe Mafnas, the Department of Finance director for administration, has been taking care of poker fee enforcement.
Gov. Benigno R. Fitial, in a separate interview, said he has to consult with Lt. Gov. Eloy S. Inos about appointing a new Rev & Tax director because this falls under the lt. governor’s area of concern.
Inos is a former Finance secretart.
Tony Pellegrino, one of the businessmen who attended yesterdays’ public hearing, said government agencies can share personnel to form a tax enforcement group.
