Saipan Tribune

Wednesday, June 19, 2013

Tuesday, March 12, 2013

Saipan chamber readies work with 18th Legislature

The Saipan Chamber of Commerce plans to meet with CNMI legislative leaders to discuss recently proposed legislation, potential initiatives, and the rebuilding of a CNMI economy that's been in a downward trend for over a decade. A beginning breakfast meeting is in the works.

Despite some recent good news concerning potential investment in the CNMI, Chamber president Alex Sablan stressed the need to be realistic about laws and regulations that would unintentionally harm what many see as a slight glimmer of hope surfacing with that new investment.

“The CNMI Legislature and administration still need to focus on government spending as the No. 1 offender to fiscal responsibility, and although we have good reason to expect such with the new governor and the 18th Legislature, there are still some messages coming from the Hill that indicate plans that are not in everyone's best interests,” Sablan said.

The Chamber has received requests for comments on legislation. The Chamber sees bills with merit being proposed, but others may require further deliberation.

Sablan said: “For instance, there's always going to be talk about generating revenue. This always ends up being increased taxation. The Chamber will always call for investment incentive as a way to build the economy, create new jobs, and increase government revenue. Throwing good money after bad just doesn't work.”

Sablan continued, “Rep. Trenton Connor has introduced a bill that calls for environmental impact fees to be collected in the second senatorial district that won't tax business, adds additional revenue to a government in need, and may create a few jobs in the process. We think this concept has more promise, actually, on Saipan. Just like the new occupancy tax to fund marketing on tourism, those impact fees would be borne by visitors using our roads, beaches, and waters. This is much more desirable than taxing businesses to fund maintenance of our tourist destinations.”

Two recent public announcements are concerns to the Saipan Chamber of Commerce.

“One is another round of proposed tax amnesty for those in violation of CNMI Revenue and Tax compliance laws. The Saipan Chamber of Commerce has never agreed to the implementation of a tax amnesty that tolerates “bad business behavior.” Just because there may have been some very limited success in the past, that doesn't necessarily translate to letting violators off the hook again. It sends a bad message to our law abiding business owners, and it sets a dangerous precedent. The government also loses revenue it would collect via fines and interest. Just enforce existing tax and revenue laws. The idea that amnesty is more cost effective than writing off bad debts ignores the fact that government should be apprehending violators, prosecuting them, seizing assets and collecting money owed the government. The fringe benefit is that people will start paying their taxes like they should. The free ride days are over, and government should act accordingly,” according to Sablan.

A second law being considered is one where rebates to individuals and corporations would be reduced by 20 percent, as a means to lengthen retirement benefits being paid to former government employees, as well as lengthening the life of the NMI Retirement Fund.

Sablan said, “We are cognizant of how much that money in circulation means to our local economy and the people that spend that money in our businesses. But, realistically, to decrease future investment potential is not worth the cost. The practical approach, as suggested by the authors, is to reduce retirement benefits during a time when the government's fiscal state may improve, not taxing the innocent. We collectively know what got ourselves into this mess, but we shouldn't have the innocent majority of taxpayers pay again for laws passed to correct errors made in the past. Again, throwing good money may not be in the best interest to all.”

Sablan concluded, “Both these measures are more political than practical approaches to real economic realities. We want to meet with the Legislature and the administration to offer what we see as prudent alternatives to the government's need to find revenue.” (SCC)