2020 revenue projections are painting a rosy picture for Guam’s economy with GovGuam collecting $19.5 million more than they anticipated in just the first fiscal quarter.
Adelup is projected to be some $30 million in the black by year-end 2020. But Lester Carlson, the director of the Bureau of Budget and Management Research, says don’t count your chickens before they hatch.
“There’s always the uncertainty of revenue interruption. As I mentioned earlier, we’re vulnerable, SARS, Bird Flu, even the North Korea threat that occurred. Those things, they have a profound and almost immediate effect on our economy,” Carlson said.
Republican senator James Moylan, however, is lobbying to revive his bill to reduce the business privilege tax from 5 percent back to its original 4 percent, before lawmakers voted to temporarily increase it in 2018.
“If we have excess money, then let’s do something about giving back the money to the people, by reducing our taxes,” Moylan said.
In a letter released today to the chairman of the appropriations committee, Moylan said he wants to see April 1, 2021 as the target date to reduce the BPT. He says cutting the tax will give businesses the opportunity to hire more and maybe even reduce prices.
Lester Carlson, however, says it’s shortsighted to talk about reducing the BPT with all the pressing issues like shortages in police officers, hospital needs, and road conditions. He says unless senators can find a consistent revenue stream to make up the $60 million from a 1 percent cut, this conversation shouldn’t be on the table.