Still no to tax hikes
TOURISM numbers are still down, businesses and consumers are still struggling, and the government is still not collecting enough revenue to pay for all its obligations.
For the administration and its allies in the House of Representatives, the “solution” is to raise taxes — in this economy. Which is like shooting yourself in the foot to run faster. The House leadership, in any case, passed the tax hike measures without conducting public hearings, and expected the Senate to do the same. But the Senate, to its eternal credit, has refused to rubber-stamp the tax-hike bills. Instead, the senators have conducted public hearings on the three main islands, and have solicited comments from community members.
However, these tax-hike measures will not go away. Painfully bereft of ideas, this administration will persist in its call for tax raises so it can concoct rosy revenue projections, and dodge the responsibility of tough budget decisions.
Voters, you should ask your legislative candidates where they stand on the tax-hike issue.
Meanwhile
WAITING. Apparently, that’s the entirety of the administration’s “plan.” It is waiting for the Korean tourism market to become what the Japan market was in the 1990s. It is waiting for the Japanese tourism market to return to what it used to be. It is waiting for more military projects and presence. It is waiting for the 902 talks, and then it will wait for the joint report, and for the U.S. Congress (fingers crossed) to act on the recommendations that require congressional approval. The administration is also waiting for the election of more pro-administration lawmakers, who will mindlessly pass tax hike measures early next year.
And meanwhile, almost two years after winning the election, administration supporters are still blaming everyone else for the poor handling of the crisis that the governor and his political allies knew they would inherit. For his part, the governor has assured us that in “two years” all this waiting will eventually pay off. How does he know? Who knows.
But meanwhile, while we wait, what about government payroll? The retirees’ 25% benefit? Utility payments? Medical referrals? Local Medicaid payments? The funding allotments for each of the government’s so many entities, among other financial obligations?
More waiting?
Just to be clear
TOURISM figures remain low because the CNMI, essentially, has only one major tourism market today: Korea. In compliance with the governor’s wishes, MVA is trying to revive the Japanese market and tap into the Taiwanese and other markets that are not China. But in July 2024, there were only 647 arrivals from Japan, and 141 from Taiwan. (In July 2019, prior to the pandemic, arrivals from China totaled 18,356.)
As an MVA official has said, “There is a big hole that was once filled by China.” Why does it exist, this “big hole”? Because there are still no direct flights from mainland China. MVA and the local business community believe that this is largely due to the suspension of Annex VI, which exempted the CNMI from a federal limit on round-trip flights between the U.S. and China. HANMI, the Saipan Chamber of Commerce, CPA, the CNMI Senate and U.S. Congressman Kilili have asked the U.S. government to reinstate the CNMI’s exemption through Annex VI, especially now that EVS-TAP will be implemented to screen Chinese visitors. But no such request is forthcoming from the governor.
MVA is the main recipient of hotel occupancy taxes that are supposed to fund the promotion of the CNMI as a tourist destination. MVA, however, “cannot market” in China because of the administration’s “stance.”
The governor, if he wants to, can ask for the reinstatement of Annex VI, and instruct MVA to resume its marketing efforts in China.
But he has chosen not to even though he himself said that the “China market is a significant market for [our] tourism industry,” and the lost income from the Chinese tourism market is “very significant. We’ve had to make drastic sacrifices in government operations and public services. People are leaving the Commonwealth because of the depressed state of the economy right now, because of the major impact of losing close to half-a-billion to a billion dollars’ worth of economic activities.”
That’s what the governor said, and he’s been in charge for almost two years now.
