Fitial to press for tax cuts, repeal of anti-business laws

In a bid to promote an attractive business atmosphere on the island, House Speaker Benigno R. Fitial yesterday vowed to pursue a package of economic reforms, including tax cuts and repeal of laws deemed impediment to enticing both local and foreign investors.

He called for support of the business community and the public to carry out these reforms which he said are necessary to ensure economic growth for the Northern Marianas amid threats of federal takeover.

Speaking before a meeting of the CNMI Bar Association, Mr. Fitial said the House of Representatives will conduct public hearings and consult with government officials, business leaders and other experts in laying down the plan.

Under his proposal, the Legislature will enact legislation to repeal anti-business laws, such as the $100,000 security deposit requirement for new investors, while coming up with fresh measures like lower taxes aimed at steering economic growth.

Tied with these economic bills are labor reform measures that will protect workers and encourage new investment at the same time — proposals Mr. Fitial said are drawn up with a “note of caution” in light of the federal takeover attempts.

“I do not wish to hand the CNMI’s critics ammunition to advance federalization. I do want to re-think how we regulate business in the CNMI,” he said in his speech.

Noting that authorities granted under the Covenant — control over local immigration and minimum wage as well as free access to the U.S. market — have pushed the island’s economy, Mr. Fitial urged a “full and effective” lobbying campaign in Washington to safeguard CNMI’s interests and development.

“I believe that government of the CNMI should be willing to put its wallet where its mouth is when the issue at stake is the survival of its entire economic structure,” he explained. “Failure to stand up strongly for what we believe may cost us money, but I for one insist that the Covenant is worth the fight.”

While labor and immigration reforms have been put in place by the Tenorio administration for the past two years, these laws have failed to convince Washington about CNMI’s commitment to address allegations leveled by the federal government, according to the House leader.

Tax cuts

Mr. Fitial, however, acknowledged new laws will have to be passed to create a “business-friendly” atmosphere to lure investors, including offering lower taxes. He admitted though that critics may say that this is a bad time to take such a drastic step, especially on the heels of ballooning budget deficit and the continuous economic slowdown.

Public expenditures will have to be tightened, while streamlining government operations by cutting appropriations to departments and agencies whose contributions have been disappointing, according to the lawmaker.

“I have in mind several, including the budget of the Washington Representative. I cannot understand what that office does, but I do know that whenever I visit members of Congress or staff in Washington, they don’t seem to know much about our Representative or what he does,” said Mr. Fitial.

He added that he would need to consult with experts, leaders and the people on how to carry out these measures he described hard tasks facing his leadership at the lower house.

“Cutting taxes will not be easy,” he said. “It will require careful preparation and well thought out proposals backed by good revenue figures. It can be done, however, and I want to begin the process very soon.”

Aside from these efforts, Mr. Fitial also promised to undertake a research to determine which other economic activities can be developed on the island, and to improve communication and transportation links for future growth.

He also pledged to lobby to reclaim huge tracts of land, particularly on Tinian, seized by the U.S. military for use by the community; and to push the much delayed streetnaming project.

“I do not want to stand still, I do not want to be defined by others, particularly by the negative proposals of outsiders from Washington, because outsiders only visit here. We live here. We should define our aspirations and we should harness our collective energy to achieve them,” said Mr. Fitial.