Saipan Tribune

Monday, May 20, 2013

Tuesday, February 26, 2013

UP FOR TODAY'S HOUSE ACTION

5 pct. hotel tax hike, faster Fund refunds

The House of Representatives will take up in today's session-and likely pass-a bill increasing the hotel occupancy tax by 5 percentage points and a measure expediting the release of NMI Retirement Fund contributions and resets timelines.

The House Committee on Tourism chaired by Rep. Ralph Yumul (IR-Saipan) recommends passing minority leader George Camacho's (R-Saipan) bill increasing the CNMI's hotel occupancy tax from 10 percent to 15 percent.

This bill's previous versions would have been the 17th Legislature's only revenue-generating bill signed into law yet could not be enforced over tourism industry concerns.

This time, the administration-sponsored measure, House Bill 18-1, has the support of major tourism stakeholders, including the Hotel Association of the Northern Mariana Islands and the Marianas Visitors Authority.

The increase in the hotel occupancy tax, if signed into law, will provide a source of funding for the underfunded MVA for its marketing and promotions of the CNMI as a tourist destination.

The Tourism Committee report said that MVA and HANMI have indicated to them that tour agents promoting the CNMI have taken a proactive approach on HB 18-2's intent and have begun including the tax increase in their promotional packages after April 1.

Fund withdrawals

The House Special Committee on Retirement Fund chaired by Rep. Mario Taitano (IR-Saipan) also recommended for passage Vice Speaker Frank Dela Cruz's (IR-Saipan) bill amending Public Law 17-82 to clarify its provisions to expedite the refunds of members' contributions and prevent any further frustration of the process.

PL 17-82 allows Fund members to, among others, withdraw their contributions without being penalized, continue working and transition into the U.S. Social Security system, remain with the Fund in hopes that the beleaguered pension program will shape up, or roll over their defined benefit plan contributions to a defined contribution plan.

“It is important that certain amendments are made to the existing law to allow a smoother transition in getting monies to members.” the committee report states.

Only about 125 of 1,700 applications received got 25 percent of their employee contributions, while majority is in limbo as to when their contributions would be remitted to them, the committee said.