Governor’s BPT raise measure fails; Senators to consider sales tax

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Guam – Despite Governor Calvo announcing a 32-hour work week beginning next week Tuesday, Senators voted against his bill 245 with a vote of 10 to 4. Bill 245 would’ve raised the business privilege or gross receipts tax by two percentage points, going from 4 percent to 6 percent.

Governor Calvo then called senators into an emergency session scheduled for 7 p.m. to discuss a bill Senator Fernando Estevez introduced today that would create a 2 percent sales tax as opposed to a 2 percent BPT increase.

“We are in a state of emergency, working families are on track to lose their incomes and fire stations are shutting down,” the governor said.

Lawmakers spent the morning asking the governor’s fiscal team various questions about taxes and about the state of the government’s finances. The legislature wanted more information before voting on bill 245.

“Anyone who’s gonna have to take this tax increase or pay for the taxes they want to see, they would take it much better if they knew the long-term plan of the government of Guam,” said Vice-Speaker Therese Terlaje.

The legislature continued asking the governor’s fiscal team questions during session today on the governor’s bill 245 which would raise the BPT by 50 percent.

The governor has said the legislature is taking too long to raise the revenues necessary to make up for the $67 million shortfall caused by the Trump tax cuts.

“This has been very long and drawn out because this is tax policy that people are going to have to endure for many years to come. They’ve all been given an opportunity to ask as many questions as they want,” said Speaker B.J. Cruz, adding, “I’m getting criticism for moving it too fast from one side of the community and another side says I’m not moving it fast enough. I’m just trying to find a happy medium in the middle giving everybody the opportunity to make whatever amendments they want to make, ask all the questions that they want to ask, and then we’ll go forward.”

Senator Frank Aguon Jr. has taken issue with the way the administration has handled this crisis calling on the governor in a press release to cut political hires before cutting to a 32-hour work week.

“Political hires are exactly that. They are interim hires. And in this particular case I insisted to the governor that if you are going to cut our classified employees you need to cut and terminate your political hires before you even move in that particular direction,” said Senator Aguon.

“I reject the false choice of higher taxes or lost pay.  I won’t surrender to blackmail and the people of Guam will not surrender to fear,” said Senator Aguon in a release, adding, “I don’t think it’s productive in any way shape or form for us senators who want to dialogue and continue this dialogue and conversation with the governor and his representatives to come up with a final solution. And what’s unfortunate here is as we dialogue and we get information they continue to come back and blast each and every one of my colleagues. So, you know to me it’s just not productive.”

Senator Fernando Estevez on the other hand feels the legislature has gone too far with its questions.

“We’re supposed to be talking about 245 right now. It started to feel like it’s turning into an oversight hearing. Especially when it gets to the point where there’s a lot of finger pointing,” said Senator Estevez.

The Republican senator, who’s announced that he will not be seeking re-election, says that this session is holding up other functions of the legislature like committee meetings, public hearings and other pieces of legislation.

“So this has to come to a conclusion or we need to figure out another solution whether its passing on file and adjourning session so that other bills can come up,” said Senator Estevez.