9 Nov 2007

Guam Senator says government of Guam loads millions a year to tax exemptions

9:01 am on 9 November 2007

The Guam Senator, Adolpho Palacios, says the government of Guam loses between US$12 million and US$15 million a year due to tax exemptions granted to banks and other financial institutions.

He believes these revenues should be recovered and used for healthcare and medical services for the underprivileged.

Senator Palacios has introduced a bill which repeals the tax exemptions that he said are being enjoyed by local banks and other financial institutions - a claim repeatedly debunked by bank executives.

Under his bill tax collections from banks would be earmarked for the Medically Indigent Program.

Under the current tax law, banks and other financial institutions are levied 4-per cent of their net incomes.

Bill 191 seeks to redefine "net income" removing certain deductible items in calculating the total gross income, such as salaries and bonuses, rents paid, regular operational expenses such as supplies, utilities and payments of insurance.