Yumul files bill to help auto dealers

Rep. Ray N. Yumul introduced on Friday a bill that will help automobile dealers in the CNMI which have been experiencing steep decrease in new automobile sales over the past few years.

Yumul’s Bill 16-203 seeks to amend the Commonwealth Code to allow automobile dealers to pay excise taxes on the importation of new vehicles upon first sale or distribution in the CNMI.

“They (auto dealers) are asking for momentary relief so that we can allow them to bring it (new vehicle) put it out for sale and when it does sale that’s when we collect the excise tax and then of course the business groups revenue tax will be collected after these vehicles are sold,” Yumul, who chairs the House’s Committee on Ways and Means, told Saipan Tribune.

The lawmaker said his legislation does not impact the general fund when it comes to taxes because he is not saying that the government will not collect the taxes.

“We do have a program right now which is called a Bonded Warehouse Program where cigarettes and other high value items like luxury goods can be brought into the Commonwealth. Taxes will not be collected but they (high value items) have to be kept in a secured facility…” Yumul said.

“So that is really the angle we’re looking at because auto dealers want to be able to have these items out for viewing for the customers,” he said.

He stated in the bill that automobile dealers continue to experience difficulties due to the worsening economic conditions of the Commonwealth.

“The Legislature is cognizant of the situation that businesses are experiencing and is willing to accommodate their needs in order for them to stay in business,” Yumul said.

Due to the decrease in new automobile sales over the past few years, he said, auto dealers are having difficulties making timely payments on the required excise taxes and fees.

The lawmaker said allowing these dealers to pay excise taxes on the importation of new vehicles upon first sale or distribution in the CNMI rather than upon entry would greatly assist them in their efforts to provide greater services to NMI residents.

“Although, dealers are still required to pay excise taxes on such vehicles, they can pay the excise tax when a vehicle is first sold or distributed in the Commonwealth thereby giving such dealers more flexibility and time to generate the funds to make timely payments,” he said.