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PSS’ Waldo makes a case for tax increases
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Posted on Apr 25 2006
A government-employed accountant is lobbying government to consider raising tax rates, rather than cutting government expenditures.
Richard Waldo, who works as finance director for the Public School System, appeared in a closed-door meeting of the House Ways and Means Committee to push for a tax increase as an alternative to lowering government expenditures.
Waldo told the Saipan Tribune that his recommendation was strictly personal and should not be construed as any part of PSS policy.
Gov. Benigno R. Fitial has repeatedly announced that he would not increase tax rates to generate more revenues for the cash-strapped government. He made his latest reaffirmation of this position in his State of the Commonwealth Address last Friday, April 21, 2006.
In a position paper, Waldo said that the administration’s wage reduction proposal would “depress the economy with multiplier effect.” Raising taxes, on the other hand, will have a positive multiplier effect as taxes cause movement and growth in the economy.
Taxes, he maintained, are remitted primarily to employees who in turn spend 95 percent of their take home salary and to vendors providing supplies and services to government.
Waldo’s proposals included replacing the gross receipt tax with a four-percent sales tax; eliminating the Chapter 7 tax and raising the Chapter 2 tax; and taxing lecture fees, professional fees, and consulting fees paid by the CNMI government.
Waldo also proposed that the government increase employee share to the Retirement Fund from 6 percent to 15 percent and then lower the government’s rate from 24 percent to 20 percent.
In addition, he asked the government to protect government jobs by not privatizing any agency and allowing professionals, rather than political appointees, to run the Commonwealth Utilities Corp., Commonwealth Health Center and Department of Public Works.
