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Lawmaker questions Saipan's lack of gaming tax


A lawmaker in Saipan is questioning why no gaming revenue tax is being collected from the operations of Imperial Pacific International on Saipan, local media reports.

Rep. Edwin K. Propst said there was no section in Public Law 18-38 that prohibits the government from imposing a gaming revenue tax on the casino operator, adding that IPI only pays an annual license fee of $15 million and the standard 5 percent business gross revenue tax.

“Fifteen million dollars a year is peanuts for what they are raking in when compared to what we would be receiving if we actually had a gross [gaming] revenue tax implementing from the beginning,” said Propst.

“We have the only casino industry in the world that charges zero on gross gaming revenue taxes,” he added.

Earlier this year however, Vice Speaker Janet U. Maratita introduced a bill that would impose a five percent tax on all gaming revenues in the CNMI.

Named the House Bill 20-31, the bill would see the new tax come into effect in two years time.

“Indeed, the CNMI government has been incurring a budget deficit since it first became a Commonwealth in 1978 and then governor Carlos S. Camacho ended his term in 1982 with a $5 million deficit,” Maratita wrote on the HB 20-31.

“The exclusive license fee that is paid currently is arguably a fair price for a legal monopoly, but even an entity that enjoys exclusive gaming rights should be paying their fair share of taxes,” she said, adding that the new gaming industry is largely untaxed.

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