Senator suggests plan to pay tax refunds - KUAM.com-KUAM News: On Air. Online. On Demand.

Senator suggests plan to pay tax refunds

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by Lannie Walker

Guam - Governor Eddie Calvo has promised this year will be different for taxpayers due returns, and one senator has come up with a plan to make sure residents aren't kept waiting. As the Department of Revenue & Taxation continues processing returns, KUAM News takes a look at how they might actually be paid this year…on time.

Resident Rose Manglona is waiting on her tax return, dating back to 2008. During his State of the Island Address, the governor promised residents like Manglona that they will no longer have to wait years to receive their returns. Senator Ben Pangelinan, who is chairman of the Committee on Ways and Means, shares that vision and sent the governor a proposal on how to make it a reality. 

"I'm proposing to the governor that we consider reprogramming the recent issue to be sold of the Tourist Attraction Fund bonds and reprogram a portion of that bond to the payment of past due refunds 2009 and back," he detailed.

Pangelinan is talking about $110 million - $30 million of which would go to pay current bond debt with $28 million being slated to build a museum. Pangelinan says he is awaiting the governor's approval of the plan. "I think its very critical to do this because if he agrees to that we can put the bill on to the floor in this legislative session it will ease the sale of those bonds in Wall Street next week when they know that we have redirected and reauthorized the bonds," he added.

In the meantime, according to Rev & Tax deputy director Marie Benito, staff at the agency are processing tax returns as fast as they can. "Right now we are working on it what we are doing is processing all the 2009 returns and our target date for that is May, early May, and then as soon as we are done with ‘09 we are going to move right into 2010," she said.

Since 2006 Benito says about 44,000 taxpayers per year have not received the tax refunds they are due.  She also notes that the department will have the processing of past due refunds complete by May and tax refunds for 2010 processed by October. She says tax refunds from 2006 to 2009 cost the government about $260 million.

However, Pangelinan says they have already addressed a good portion of that amount. "In the year 2010 for the Fiscal Year 2011, we have already budgeted $100 million, so really the past due refunds are about $160 million, even down to $135 million, based on recent payments."

Benito says tax refunds for 2010 are estimated to run anywhere from $80-$100 million, adding, "We process them we get them ready and as soon as we have funds, which is not soon enough we issue refunds so what we are doing is we are just getting it ready and we also need it for stats for budget purposes."

Senator Pangelinan says he has already sent a letter to the bond counsel to begin the process, so if the governor does give the plan the green light the counsel will be up to speed. "So I'm just waiting for him to demonstrate whether or not he really has that commitment to pay those refunds and hears a great opportunity to do so."

Whether Governor Calvo implements Pangelinan's plan, it's a commitment taxpayers like Manglona are hoping will be kept. "I hope so, that it will come out sooner or later," she shared.

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