Split testimony on bill to regulate Guam trusts - KUAM.com-KUAM News: On Air. Online. On Demand.

Split testimony on bill to regulate Guam trusts

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Split testimony was heard on a bill that would further regulate trusts operating in Guam. Millions of dollars in lost tax revenue - Senator Joe San Agustin says that's the basis behind the Guam Qualified Domestic Plan Trust Act, or bill 179, which was heard before senators this afternoon.

The bill would require companies offering trusts to obtain a certificate of qualified retirement plan trust locally, with the end goal being to increase tax payments made to the Department of Revenue and Taxation.

Banking and insurance commissioner and former DRT director Art Ilagan said he supports the bill, adding the lax regulations have lost GovGuam millions in its fair share of taxes. "The leakage is difficult to determine when the pension plan taxes or the plans itself are not filed in Guam," he said.

In addition, he argued the bill would better protect citizens from fraudulent or rogue pension plan operators. However, Guam chapter of the National Association of Insurance and Financial Advisors representative Jon Ulloa argued the bill would violate federal antitrust laws. "Currently there is only one Guam based trust company that provides retirement plan services; therefore, in violation of US antitrust legislation, you cannot legislate into a monopoly or duopoly if there happens to be one other provider," he said.

Advisors Unlimited representative Flo Martinez agreed, adding the bill could eliminate existing companies and options available to residents relying on them for their investment needs. "If you pass bill 179, I think we will be sacrificing too much for a great number of our local people," he said.

However, John Clark from ASC Trust Corporation said rather than hurting businesses, he believes the law would create more accountability and business opportunities for local companies. "It's a way to I think open up the business and offer more trust services for GovGuam to make sure they're able to collect rightfully the withholding tax that is for Guam sourced income and it's something that should have been done many, many years ago," he said.

 Senators San Agustin and Jim Espaldon expressed the need to further review information presented by both sides at today's hearing, with San Agustin adding he plans to meet with NAIFA to discuss the organization's concerns.

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