GovGuam's shortfall projected to balloon to $67M - KUAM.com-KUAM News: On Air. Online. On Demand.

GovGuam's shortfall projected to balloon to $67M

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The news gets worse for the government's looming fiscal freefall. New estimates indicate the shortfall will balloon to $67 million from the previously predicted $48 million based on new withholding tax computations. Members of the Special Economic Service discussed a range of options for "revenue enhancement," that's political speak for tax and fee increases.

Ricky Hernandez is with the Legislature's Office of Finance & Budget, and told KUAM News, 'With the five different taxes we looked at they are GRT, hotel occupancy taxes, tobacco and alcohol taxes, property taxes and the surcharge as authorized by the organic act on income taxes, so there's a range of options here."

The government is apparently leaving no stone unturned in its search for revenue to make up for the losses from the Trump tax reforms.  Acting Budget director Lester Carlson continues to push for a 50-percent increase in the Business privilege tax, but also cites other examples. "We're talking about things like a resort fee," he said. "A wholesale surcharge, that's not a tax that's a surcharge. There was an automated traffic light ticketing system that this island might want to consider given the propensity of red lights that are run on a day to day basis. There's also a travelers security fee that was mentioned - a rent a car tax."

He added, "I would propose that all the cares that are used for commercial purposes that these companies own the registration fee be doubled."

Meanwhile, the Administration has re-implemented mandatory cost containment and budget reduction measures. Carlson says they have identified about $16 million in cuts by line agencies, but the trade-off is a corresponding drop in government services.

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