Yesterday, Senator Lujan introduced Bill 3-37 to roll back the BPT from five percent to four percent while keeping all existing exemptions for small businesses in place. Senator Lujan also introduced Bill 4-37 which suspends all BPT on the sale of food and medicine. Bill 4-37 calls for a twelve-month suspension. In addition to the two bills, Lujan introduced Resolution 2-37 asking the Secretary of Homeland Security and the Sectary of Defense for a Guam-specific Jones Act waiver for twenty-four months.
“I want to start the first week of the 37th Guam legislature with a sense of urgency and to immediately provide Guam residents and businesses with some relief against the relentless inflation we are all suffering. Consumers and businesses need to be given as much relief as possible, as soon as possible, to combat the ever-rising cost of goods and services we are subjected to,” Lujan expressed.
Bill 3-37 rolls back the Business Privilege Tax to four percent for any and all businesses currently paying five percent and leaves all the exemptions in place for all businesses who qualify for BPT of three percent or less. “I wanted to make sure the legislation rolled back the increase passed in 2018,” Lujan said.
“Bill 4-37 suspends all BPT on food and medicine for twelve months. This should immediately provide relief for consumers at grocery stores, mom-and-pop stores, or any place people purchase food. It should also very quickly help diners, and restaurants of all types, reduce expenses,” Lujan asserted.
“Food prices have increased so dramatically over the last twenty-four plus months, we really need to do everything possible to lower the cost of eating for everyone on Guam. Bill 4-37 will also reduce the cost of over-the-counter medicines for everything from the flu to headaches, colds, and anything that ails you,” Lujan voiced.
“The Jones Act Resolution 2-37 seeks a twenty-four-month Guam-only waiver. It makes no sense for Guam to be subjected to the Jones Act. With so little competition, the cost of shipping from anywhere in the mainland to Guam is brutal, it is far too expensive,” Lujan stated.
The Jones Act is a 1920 maritime law mandating that only US-built and flagged ships carry cargo from one US port to another. But planes made in Europe by Airbus can move cargo from San Francisco to New York and trucks made by Mercedes in Germany can carry oranges or goods from Florida to New York. The law was designed to protect the US shipping industry and for national security reasons; a 24-month waiver for Guam will not negatively affect either issue.
“Seeking a permanent exemption is a longer-term solution, but providing a temporary exemption for Guam residents is possible, via a twenty-four-month waiver. Both the Secretary of Homeland Security and the Secretary of Defense have the authority to grant jones act waivers. My resolution highlights that Guam definitely qualifies for a Jones Act Waiver. The process to apply for the waiver is very straightforward. But we must demonstrate unanimous support from the Guam Legislature, the Governor of Guam, and Guam’s Delegate to Congress. If passed, this resolution is the initial and biggest step necessary to getting the twenty-four-month waiver. I have spoken with Governor Lou Leon Guerrero and Congressman James Moylan, who are both very supportive. If the legislature adopts Resolution 2-37, I will coordinate with the Administration and the Congressman to finalize the application for the waiver. It will be a challenge, but Guam has never had a stronger case to make,” Lujan said.
“I am committed to doing everything possible to use the tools available to the government of Guam to fight inflation. The government tools are limited, but if all three of the legislative actions are supported, they can help reduce the cost of goods we all pay. Both BPT bills can provide immediate relief, and the Jones Act Waiver can open the doors to competition and potentially much lower shipping costs,” Lujan concluded.
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