Lawmakers will likely “finish” 2% sales tax bill on Monday

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Guam – Senators continued discussions on Senator Joe San Augustin’s bill 248 that would create a 2% sales tax in what is now the 8th special session that has been called by the governor to deal with the fiscal crisis.

“So now we’re sitting here with this sales tax in front of us. This sales tax bill in front of us and I remember everyone saying this was more palatable because it was more transparent. You can see it on the receipt at the end of your purchase that this two percent was added onto your purchase,” said Senator Louise Muna. Testimony from the business community during yesterday’s (Thurs.) public hearing on bill 248 leaned towards the implementation of some form of sales tax if a tax increase was necessary.

Local businessman Carlos Camacho provided a case study impact showing the average cost a 2 percent sales tax would add to the average resident’s budget. “Food costs and other expenses that total a little over 1,200 dollars and I’m just going to assume that maybe this is a month right and I don’t know anybody who spends 1,200 dollars on food and expenses a month but a 2 percent on top of that is only 25 dollars,” said Senator Muna. Or if you spend $600 a month on groceries then the 2% sales tax would cost you an additional $12 a month.  “So, I keep trying to wrap my head around why people keep saying this is so devastating. I don’t understand it. So, when I saw it in actual numbers I started to understand more that maybe it really isn’t as devastating as people think it is. They’re only led to believe that it is by saying it’s a 50 percent increase. So, if it’s a temporary solution and it’s something that’s gonna get us through this fiscal crisis at this moment then I say we should support it,” said Senator Muna.

Lawmakers spent the afternoon proposing discussing and adding amendments to the bill. Senator San Augustin added an amendment that would require sales taxes to be reported and paid monthly similar to the business privilege tax. Frank Aguon Jr. proposed an amendment that would allow the governor to reorganize the government of Guam. It’s essentially what was proposed in his bill 247-34 or the “government priorities act of 2018.” The measure and the amendment establishes education, health and public safety as the top priorities of the government and it removes impediments to GovGuam reorganization. Basically, it would allow the governor more authority to shrink the size of the government by abolishing or combining agencies, eliminating positions and reducing the size of the GovGuam workforce. Senators were still debating Senator Aguon’s GovGuam reorganization amendment when they recessed at 5pm until Monday at 9am. Senator Tom Ada made the motion to recess saying they would “finish off” the bill on Monday.