The Senate also reduced the amount of the proposed supplemental budget from $4,800,000 to $4, 256,400.
One of the sources identified by the national government to cover the supplemental budget is by way of increasing taxes.
The senators opted to take up the proposed raise in taxes in a separate bill.
“The Committee members all expressed mixed reactions on each of the proposed taxes at this time and reached the consensus not to include the proposed tax measures with the supplemental budget request and moved to have those addressed as independent bills,” the Senate Committee on Ways and Means report stated.
In its committee report stated that the authorization and appropriation request was reduced by at least 24 percent.
The committee took into consideration the concerns expressed by the private sector on the proposed taxes at the same time doubted whether the government will be able to achieve the projected amount by way of proposed taxes if it will be based on prior projections.
President Toribiong has asked the Olbiil Era Kelulau an additional sum of $3,613,000 to supplement the general operations of the national government. If the proposed taxes are to be considered, the supplemental budget would have reached to about $4,800,000.
The committee members also stated that the current level of local revenues suggests that there may be a collection shortfall at the end of the fiscal year.
Citing financial records, the committee said that at the end of the 2009 calendar year, the level of local revenues was 23 percent.
At the end of March 2010, they were at 45 percent.
The committee also noted that the source of funding for the supplemental budget is from the Compact of Free Association funding extension not from the local revenues, thus it suggests that the government can be more prudent in its spending.
The committee recommended that the cut in spending can be achieved if the government will continue with the current freeze in hiring, avoid non-essential purchases, improve productivity, cut power consumption and reduce other expenses that waste government resources.
“In doing so, it will strengthen the good probability that this fiscal year’s budget will not carry forward a deficit in the imperfect system we are managing in,” the report stated.
The bill was immediately transmitted to the House of Delegates for action.
The April Congress regular session is slated on April 13, it is not known however if HOD will conduct a special session to tackle the measure.
