Mayors urge senators to leave tax increase intact

COUNCIL: Mayors' Council of Guam President Melissa Savares has sent a letter to the island’s 15 senators urging them to leave the business privilege tax where it is at 5%. The mayors' council members are shown in a recent meeting. Post file photo

Mayors' Council of Guam President Melissa Savares has sent a letter to Guam's 15 senators urging them to leave the business privilege tax where it is at 5%.

The letter was written in opposition to Sen. James Moylan's proposal to roll back the tax to 4% where it was last year before the 34th Guam Legislature approved a 25% increase to 5%. Senators approved the increase to cover the shortfall created by the Trump tax cuts.

“We plead with you to truly consider the impact and the ensuing problems that Bill 9-35 would cause our villages,” wrote the Dededo mayor in her letter, which was signed by 16 of the island's 19 village mayors. Six of seven vice mayors also signed the letter.

Ordot-Chalan Pago Mayor Jessy Gogue, Agat Mayor Kevin Susuico, Piti Mayor Jesse Alig, and Agat Vice Mayor Chris Fejeran did not sign it.

"If we saw more of how we were saving money," Alig said in a phone interview, "then I would probably be more inclined to support the 5%."

Moylan’s Bill 9-35 was introduced at the start of the year and received strong support from the business community during a public hearing in July.

Gov. Lou Leon Guerrero recently said she prefers keeping the tax increase "forever" or at least until an alternative new source of revenue can be identified.

However, Savares pointed out that Moylan's bill would result in a $58 million shortfall for GovGuam. That means less funds for the services provided by the mayors' council and "would make our already difficult work even harder."

Savares said the village mayors are the “first responders” to the problems raised by residents who expect the mayors to address broken streetlights, open or repair roads, clean up illegal dumps, get rid of stray and dead animals or provide funeral assistance. “The list goes on,” wrote the mayor.

In response, Moylan issued a statement, saying, “we respect the position of the Mayors Council of Guam.” But he argues “the BPT is a regressive tax and impacts working-class families at the cash registers, hence we are still committed towards the reduction.”

Moylan added that “we still need to identify cost-cutting measures and new revenues so that frontline entities such as the mayors' offices are not gravely impacted."

The senator said he hopes to work with the mayors' council on that process "as we need their assistance.”