Pacific Island Times Vol 3 No. 3 March 2018 - Page 4

FROM THE PUBLISHER’S DESK A Capricious tax hike delup has been spewing out hysterical press releases, warning of payless paydays, fur- loughs and possible cuts in government programs and services unless the Guam Legislature succumbs to its proposal to raise business privilege tax from 4 percent to 6 percent. It’s supposed to make up for the $47.9 million drop in tax revenue (the lowest estimate) as a result of President Trump’s federal tax reform. What is more appalling other than holding public services hostage and sum- moning the furlough bogeyman is the administration’s bid to avert a revolution by audaciously attempting to condition the taxpayers into believing that the proposed BPT increase is only 2 percent. “Anything less than a full, but temporary increase of 2 percent will have deep implications on the future of health care and our road to economic prosperity,” Gov. Eddie Calvo said in his last State of the Island address. It is 50 percent! And while BPT (also known as gross receipt tax or GRT) is levied on businesses, the ordinary con- sumers will ultimately suffer. The governor knows this. When he was the Legislature’s vice speaker and chairman of the finance and taxation committee in 2007, he opposed the Camacho administration’s proposal to raise GRT from 4 percent to 5 percent. “When it comes to a GRT increase of 25 percent, that cost will pass along ultimately to the consumer and there is an issue especially for many of these con- struction projects that are going on now” he said in an interview with KUAM. “You have a set price and that includes the GRT of 4 percent - if you increase to 5 percent someone’s going to have to absorb it.” To assume that the emergency temporary tax hike will pave “our road to economic prosperity” is a comedic hyperbole. It is only intended to bridge the gap that will be created by federal tax cuts. The ordinary households’ corresponding budget cuts will have to be factored into the calculation of projected revenue from this proposed tax increase. The expected surge in prices of commodities without a corresponding pay increase will prompt consum- ers to tighten their belts and prioritize their spend- ing. They will stay home instead of dining out and watch NetFlix instead of going to the movie. When 4 buying large ticket items, they may choose to shop online. These household austerity measures will go on given that businesses are not likely to roll back their prices once the emergency GRT increase expires after the 24-month sunset period. This is not the first time the government of Guam has been faced with a “financial crisis.” Raising taxes— if not borrowing on the bond market — is, habitually, its default solution. In 2003, the governm )Ʌ͕ѡIPɽЁɍЁѼ؁ɍ)Ѽɥչ͡љQȴ)ЁIPɅ͔ٕ݅́Յ䁱ѕ(иQɔ݅́ɕɑձѥ)́ͥѥٔЁѡ)ѡȁ݅́ѡɔ䁥ѥѡЁѡ)IPɕ͔ٕqȁɽѼ)ɽɥ今t)%Ё́ѕѥѼЁѡٕȴ)ˊéɽͅѼЁѡ APᕵѥ)ɅѕѼЀ̸ѕȁ)ӊéQ=AՉչх)ͅ AṔЀ́ɍЁՅe)ɕٕՔЁᕵѥ͔́ѡٕɹЁѼ)́ЁٕɅȁ啅ȁ)ѕѥɕٕՔ!ݕٕȰݥѡ)͕Օ́Ʌͥ APɍаѥѡ)ᕵѥ̃P䁙ȁѡݡͅ+Pݽձ奕ѡͅɕձ̸Qɔ́ՅɅ)ѕѡЁѡٕɹЁݽձЁѡѥɔܸ)Ёѡɔ́хѡЁɥ́ݥ)յ́ݥ䁱̸]Ё́Ѽѡ)ѥѡɑ䁵х́݅́Ёѡݽ)ɝ)Qɔ́ѡѡЁͻeЁͅЁ)ɕͥхก%Ё͡ձݡѡ)ٕՕ́ѼɕՍٔᡅѕ)Ё͡ձݥѠ͍ɕͥ)ȁ܁ݔݥ䁙ȁѡЁ)Q ټɅѥ́Ё́ɕ٥ͱ)ѕѡ́ɥ9܁Ё )ѡIѡͅɥ́ѥ)ѕ̰ѕȁаєչͅ)ͥѥ́ѡЁٔɥͱ䁍ɕѕ́)剅ȁѥٽ̸)%ӊéЁɐѼ٥х́ѡЃq)ɥͥϊt̸)AՉ͡)5ȵY Ʌ)Չ͡ͱѥ̹)ѽȵ ) Ս1)ѽͱѥ̹)ͽєѽȀA9єAԤ)=չ-́-ͽ)ͽ)Aԁ ɕԁ ) ɹє ɕ)ɕɹѕ) ɥѥ]ɥѕ))協5 ɔ)i))幔ɕ) ɱф1Օɕɼ)5ɬIɥՕ)͔5̈́5))͕5)5))M)e͡ф)ѽɥ ѽ)ɕ9Ʌ)Ḿ5ɭѥᕍѥٔ))M8խ݄)ͱѥ̹)չЁᕍѥٔ)5ɥɔ)ͅͱѥ̹)Ʌѥٔͥх)1фQɕ)ͭ兡()A%Ё9́M٥11 )QյḾA(ȁAMYѽɕ́I)QյՅ)Q耠Ĥ)A%ͱQ)]ͥєܹͱѥ̹)@< -ɽȰAԀ)Q)QA%ͱQ́́Չ͡)ѡ䁅ɍձѕՅA)ѡA%Ё9́M٥)11 ѽɥٕѥͥՉͥ)ɽ䁽ѡA%ͱQ)ЁѕݥѡЁ͕Ё)ѡՉ͡ȸÝ́ɽ)ɥѽ́Ёͅɥɕɕ͕Ёѡ)ѽɥͥѥѡA%ͱQ̸