11 Feb 2011

American Samoa government says public servants may be laid off

2:37 pm on 11 February 2011

A layoff of government employees may be the next step if the America Samoa government's financial situation doesn't improve.

Local reports say the administration will consider reducing the workforce in June if there's no change in government finances.

The layoffs were mentioned during a discussion of the cuts in government workers' hours which began this week.

It's estimated the reduction in hours, which affects more than 2,500 employees will save 3 point 2 million dollars for the year.

Meanwhile the Senate has passed a wages tax bill allowing for a two percent increase in income tax, which is expected to generate several million dollars of additional revenue.

The House, which is yet to vote, is considering a wage tax rise of 4 percent - the level the governor had called for - which officials say will raise 7.4 million US dollars.