Guam Legislature approves rollback of business privilege tax to 4% effective Oct. 1, 2026; attempts to restore or narrowly exempt large military contracts fail

Senator Sean Gamutato, sponsor of the amendment to substitute bill 44-38 (the FY2026 budget), secured passage of a date‑specific change to the business privilege tax that would set the BPT at 4% effective Oct. 1, 2026. The measure passed following a roll‑call vote, 8 yays to 7 nays.

The measure and two subsequent amendments drew prolonged debate about whether the island should return revenue to businesses now or preserve funds for public services. The body rejected a motion by Senator Chris Barnett to restore the BPT to 5% (vote 4–11) and later defeated an amendment to keep the 5% rate on military contracts exceeding $10 million (vote 7–8).

Why it matters: The BPT change affects broad swaths of Guam’s private sector and is tied directly to debate over funding for education, the Guam Memorial Hospital Authority, the Department of Corrections, and the rainy‑day fund. Supporters said the rollback honors a prior promise and would return surplus collections to taxpayers; opponents warned that reducing the rate now would force cuts to critical services and leave the government short on matching funds for federal programs.

Sponsor’s case

Senator Sean Gamutato (sponsor) said he filed a date‑specific amendment to chapter 1, section 2 of substitute bill…