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Hillblom Estate settles $9.5 million tax obligation
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Posted on Jun 16 1999
Bank of Saipan, which serves as the Executor of the Larry Hillblom Estate, yesterday turned over to the Department of Finance a $9.5 million worth of check representing payment of the Estate’s tax obligations to the government.
BOS director Ben Fitial handed the check to finance officials during a simple ceremony at the Governor’s Office in Capitol Hill.
The tax settlement is contained in a recent agreement between the Executor and the government pertaining to the tax liabilities of the Estate.
The agreement was approved by the Superior Court last June 10.
The original tax assessment made by the finance department on March 17 reached more than $30 million for tax claims ending April 30, 1996 through April 30 1998.
Finance officials used Public Law 11-52, the probate tax law, in assessing the government’s tax claims against the Hillblom Estate.
The Executor had protested the government’s tax assessment result, arguing against the constitutionality of enforcing the retroactive estate tax provisions of PL 11-52, which was signed on Jan. 14 of this year.
The CNMI government later offered to settle all claims for income and earning taxes for years ending on April 30, 1999 and for the estate “or other transfer taxes on distributions from the Estate.”
Under the Heirship Settlement Agreement, the Estate was required to pay $6 million for estate tax, $3.2 million for income tax, plus the tax deficiency interests.
Gov. Pedro P. Tenorio said portion of the money will be used to settle part of the government’s back contribution to the Retirement Fund, as well as pay overdue accounts to vendors.
Finance Secretary Lucy Nielsen reminded government agencies that the fresh infusion of money into the local coffers would not mean that requests for additional funding by government agencies would be granted.
“It’s going to go a long way and but we still have to determine where the money is needed most. It will depend on the need of government offices,” Nielsen said.
The check was turned over to the CNMI Treasury immediately after the ceremony.
