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Rota exemption from excise tax
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Posted on Dec 02 1999
The Rota municipality is trying to seek a limited waiver on the imposition of excise taxes on telecommunications equipment and machinery to encourage the private sector to develop cellular technology on the island, which is only available on Saipan and Tinian.
Rep. David M. Apatang, chairman of the House Committee on Public Utilities, Transportation and Communications, and Rota Rep. Alejo M. Mendiola have filed a bill granting the six-month tax break on the island municipality.
The legislation, which is expected to be taken up in the next House session, stressed that the needs of the private industry must be balanced against the government’s duty to raise revenues.
“We feel that by waiving the excise tax for telecommunications equipment and machinery for a limited time both interests will be saved,” both lawmakers said in their findings.
It is not known how much the government will lose in terms of the revenues if the excise tax is waived, although Mr. Apatang noted that Rota must be given the chance to develop its telecommunications technology to be at par with the rest of the Commonwealth.
“In order for them to get that, we are asking the vendors to come in and build the cellular antenna on Rota. Because of the economic situation, they need the money in order for them to buy the communications equipment,” he said in an interview.
Under the proposal, the tax break will begin immediately upon signing into law and will last six months. It will only cover telecommunications equipment and technology for first use on Rota.
“By suspending its collection for a six-month period, telecommunication firms can come in and build the cellular site on Rota so that it can have the same privilege as we have on Saipan and Tinian,” added the PUTC chairman.
