Guam hearing weighs rollback of business privilege tax as private sector presses for relief

Senators and dozens of private‑sector witnesses spent hours on May 20 at a Guam Legislature public hearing debating Bill 11‑38 COR, a proposal to restore the business privilege tax (BPT) rate from 5% to 4%.

The bill’s author, Senator Sean Gumata, opened discussion by describing the rollback as a way to return roughly $80–85 million a year to businesses and households that he said would be reinvested locally. “Businesses do not pay taxes. People pay taxes,” he said, summarizing testimony he has heard from small business owners across Guam.

Why it matters: The measure pits two fiscal priorities against one another. Government budget officials told the committee that reducing the BPT would create a material hole in projected revenues and could cut deposits to dedicated funds used for hospital pharmaceuticals and the government’s rainy‑day reserves. Private‑sector groups, medical providers and local business owners said the 1 percentage‑point rollback would relieve businesses still recovering from tourism losses and staffing pressures and would help retain clinic and hospitality staff.

Budget office presentation: Lester Carlson, director of the Bureau of Budget and Management Research (BBMR), and other administration witnesses walked senators through recent revenue history and the administration’s fiscal projections. Carlson noted that measured “excess” collections have been driven largely by income and withholding taxes rather than the BPT alone. BBMR reviewed fiscal years 2019–2024, showing years with excess revenues (for example, FY…