House adopts Senate resolution that asks Palacios collect $25.3M uncollectible BGRT

The House of Representatives has adopted a Senate joint resolution introduced by Senate president Edith E. DeLeon Guerrero (D-Saipan) that requests Gov. Arnold I. Palacios to task the Division of Revenue and Taxation with collecting all Business Gross Revenue Tax owed the CNMI government that, according to the Department of Finance, has now reached $25.3 million in total outstanding collectibles.

With 11 House members voting “yes,” six voting “no,” and floor leader pro tem Ralph N. Yumul (Ind-Saipan) abstaining, the House adopted Senate Joint Resolution Number 23-02.

Those who voted “no” were Reps. Manny Gregory T. Castro (Ind-Saipan), Angelo A. Camacho (Ind-Saipan), Diego Vincent F. Camacho (D-Saipan), Joseph A. Flores (Ind-Saipan), Malcolm Jason Omar (Ind-Saipan), and John Paul P. Sablan (Ind-Saipan).

Reps. Edwin K. Propst (D-Saipan) and Thomas John Dela Cruz Manglona (R-Saipan) were absent, but excused from the session.

Before the voting, Castro said that, while the intention of the resolution is good, he feels that this is already within the governor’s prerogative to have this done.

“And at the same time, I believe it’s already their job,” said Castro, referring to the Division of Revenue and Taxation.

Castro was among those who signed the House Ways and Means Committee’s report that recommends the adoption of the joint resolution.

He said yesterday that he changed his mind during the voting as he wants to see more support for funding or equipment that will make tax collection more productive.

Castro underscored the need to put more emphasis on tax collection, but also makes it easier for businesses.

During the miscellaneous portion of the session, Rep. Vincent S. Aldan (Ind-Saipan) said he agrees that the Legislature shouldn’t have any say in telling the Executive Branch what to do and what not to do.

“So yes, it’s not our job to tell the governor on what to do with these agencies and what not. But when it comes to funding, yes, I think we do need to tell them what to do. Because evidently, somebody’s not doing their job,” Aldan said.

DeLeon Guerrero introduced the joint resolution last Feb. 8 and the Senate members unanimously adopted it at their special session last Feb 14.

DeLeon Guerrero stated in the resolution that the Department of Finance is still “reconciling” the numbers pertaining to the expenditures of American Rescue Plan Act funds, ARPA-related projects, including the Building, Optimism, Opportunities, and Stability Together or BOOST program.

She said the Nutrition Assistance Program Tax Audit Report of 2018 to 2021 shows that $24.8 million in NAP gross revenue is unreported.

The president said with the current financial crisis of the CNMI, it is highly critical that strict and timely collections of all revenues be enforced.

The resolution was referred to the House Committee on Ways and Means chaired by Yumul.

According to the committee report, the Fiscal Response Team is still collecting information and data to make an accurate financial projection and the Department of Finance is still reconciling the numbers pertaining to the expenditures of the ARPA funds, ARPA related projects, and the BOOST Program.

The committee finds that it is critical that the Division of Revenue and Taxation investigate the variance between the amount of NAP issued and what the businesses reported on their BGRT documents.