DRT opposes hiring of company to enforce tobacco stamp law

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Legislation that would allow the Department of Revenue and Taxation to issue an RFP for a company to enforce the tobacco stamp law did not get the support of tax officials.

The legislature held a public hearing for Bill 368, which was introduced by Speaker Tina Muna Barnes to improve the collection of taxes on cigarette products.

While there is a current tobacco stamp law, Barnes said enforcement was an issue since it was simply too expensive to implement its provisions.

Barnes thinks that the government is not collecting the right amount of tobacco taxes and that the impact is felt by government agencies and the public hospital.

Michelle Santos, DRT Deputy Director, spoke on behalf of Rev and Tax. She said DRT never implemented the tobacco stamp law because it was an unfunded mandate and they needed clarification from the AG that it was not double taxation.

She said that the bill also dictates the drafting of rules and regs when the rules and regs are already provided in existing legislation.

Santos also said that the payment to the potential offeror is exorbitant… they estimate this to be $3 million to $4 million a year.

She said these funds are diverted from the Healthy Future Funds that affect agencies such as GDOE, GMH, Public Health, Guam Behavioral and Wellness, and DISID.

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