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Increased FY 2005 budget seen
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Posted on Oct 12 2004
Gov. Juan N. Babauta signed into law yesterday a tax enhancement bill that aims to generate up to $6 million additional funds within the current fiscal year.
Babauta signed House Bill 14-180, an amendment to the CNMI Revenue and Taxation Code, which aims to standardize tax administration practices and procedures used in the assessment and collection of taxes in the CNMI.
The enactment of the law now allows the Babauta administration to include it as additional source of funding for fiscal year 2005.
The administration intends to submit a revised budget projection to the Legislature to ensure that it gets at least $218 million appropriation for 2005. The House has only approved a $212.651 million budget level.
To raise it to $218 million, the administration would submit additional revenues from two sources: the tax amnesty law, which is projected to generate at least $2.1 million; and the tax enhancement bill, which is estimated to provide an additional $3 million to $6 million.
Babauta said that, although H.B. 14-180 deals mainly with technical revisions, several important new provisions are included that enhance the power of the CNMI to enforce the Revenue Taxation Code.
Among others, the new law allows the Attorney General’s Office to commence civil or criminal actions to collect any taxes assessed against tax evaders.
The law also empowers the Finance Secretary to reduce the amount of rebate or other overpayment of tax that are payable with past-due legally enforceable debt.
All these and other enforcement provisions related to the imposition of liens and seizure of property to satisfy tax obligations will help to ensure that individuals, businesses, and corporations pay their obligations to the government, Babauta said.
In another development, the Senate is scheduled to hold a session this morning to act on the House-approved appropriation.
The Senate can amend the budget bill, raise it to $218 million, and refer it back to the House for concurrence.
The Executive Branch earlier submitted a $226 million budget proposal for the Legislature’ approval.
