By Mar-Vic Cagurangan
Mounting inflation has prompted Republican senators to propose a temporary tax relief on food products to mitigate the burden of skyrocketing prices of commodities.
The proposed measure, Bill 316-36, would exempt food products from business privilege tax through Aug 31, 2024. It would also require a visible BPT on receipts for consumers, which would not be levied.
“Something needs to be done, as the island joins the nation in experiencing unprecedented inflation, which is hurting every family in Guam through rising costs in food, fuel and so many other necessities," said James Moylan, author of Bill 316-36.
"This legislation is merely just a start, and clearly much more needs to be done. However, at this point, it is the only solution on the table when it comes to food purchases," he added.
Similar tax relief measures have been proposed across the United States.
According to the Bureau of Statistics and Plans' most recent report, Guam's second-quarter consumer price index of 148.3 shows an increase of 3.2 percent over the first quarter and 7.6 percent compared to the same period last year.
The Food Group Index of 177.6 shows an increase of 4.9 percent over the preceding quarter and 16.7 percent when compared to the same period one year earlier.
"I do hope that this legislature and the administration prioritize the issue and help get some relief passed on to island residents," Moylan said.
The bill is co-sponsored by Sens. Tony Ada, Frank Blas Jr. and Chris Duenas.
While acknowledging that the proposed tax relief would impact the government's tax collections, the bill's authors noted that the administration "has stated on more than one occasion that revenues are exceeding projections, thus the opportunity to cover shortfalls should be made available."
“If the administration's claims are accurate, and we are indeed collecting more than what was projected for this fiscal year, then instead of spending the money on lesser needed priorities, some savings should be passed on to the consumer through this tax exemption," said Moylan, a candidate for Guam's delegate seat.
“I would further hope that the governor is considering another round of relief checks, with higher qualifying income thresholds, which would not only help families with their food and fuel purchases but also help additionally stimulate the economy."
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Blas, meanwhile, reiterated his call for Gov. Lou Leon Guerrero to provide financial assistance to families struggling with rising costs, tapping either the $345 million in remaining American Rescue Plan funding or a portion of the $82 million excess in fiscal 2022 revenue reported by the administration.
“It continues to be unconscionable that while families are struggling to pay rising food, gas, and utility costs, our government is holding on to ARP and excess revenue monies," Blas said. "Many families are one step away from financial catastrophe if they aren’t there already, and the administration wants to hold on to the money to grow our government?"
Blas suggested cash assistance of $1,000 for each individual taxpayer and $2,000 for joint filers.
“The governor can set a condition that the money can only be used for the purchase of goods and services on Guam so that the money can circulate within and stimulate our economy,” Blas added. “The day after I sent my first letter to the governor, I met with the lt. governor and had a brief conversation with him on the matter. While his response was brief, he said that they already had ‘something in the works.’ That said, there has been no discussion or inkling of when or if any financial assistance is forthcoming," he added.
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