Togiola asks U.S. Senators to consider American Samoa in tax reform debates
Gov. Togiola Tulafono has written to two ranking senators of the U.S. Senate Committee on Finance to keep American Samoa in mind during Congressional debates on federal tax reform laws and to consider tax credits that will benefit U.S. companies wanting to set up in the territory.
The committee has been holding hearings on tax reforms, with one held May 15 on the impact of federal tax reforms on American Indian tribes and the U.S. territories. The committee is chaired by U.S. Sen. Max Baucus (D-Montana) and Ranking Member is Orrin G. Hatch (R-Utah). (See Samoa News edition on May 17 for more details on this hearing.)
Speaking on his weekend radio program, Togiola revealed that he had written to Baucus and Hatch to keep American Samoa on their agenda when reviewing and debating tax reform laws.
Togiola says the current federal tax credit 30A, which replaced the previous IRS Section 936, is not permanent and due to expire soon. He said the current tax credit, like its previous predecessor, provides federal tax credits for only the canneries and not any new U.S. based business wanting to set up in American Samoa.
Without a federal tax credit that would benefit all new companies setting up in American Samoa, attracting new ones to the territories would be made difficult, said Togiola, who pointed out that the letter to Baucus and Hatch calls on the senators to look at any specific tax programs that would be beneficial to all businesses and to replace the current one, when it expires.
While the governor didn’t specify if ASG had submitted any new tax proposals for consideration, he did say that Congressman Faleomavaega Eni is aware of local efforts and is pushing on his side so that a tax program for American Samoa is approved that would be more beneficial to all companies as well as to the economy.
He said American Samoa’s tax proposals would not require the federal government to provide additional money to the territory.
“[Just] give American Samoa the chance and opportunity to work with these U.S. companies wanting to do business here so their companies will be successful resulting in a good local economy providing jobs,” he said and noted he hopes that the two senators — who have being supportive of previous benefits for American Samoa — will again lend a helping hand.
More than two years ago, the governor presented two tax credit proposals to the U.S. Senate for review and consideration, saying the proposals would benefit all companies wanting to do business in the territory.
One proposal is based on a tax credit for doing business or trade within American Samoa, the other is a non-refundable tax credit to be applied to reduce the income tax a business would owe ASG.
Also on his radio program, the governor revealed that he has spoken with the U.S. State Department about the federal government possibly offering this same type of federal tax credit to U.S. companies wanted to do business in neighboring Samoa, because it will end up also benefiting American Samoa.
While jobs will not be available in American Samoa by offering such tax credits dealing with Samoa, Togiola says American Samoan residents can relocate to Samoa to work at these U.S. companies. The governor said this particular issue was not mentioned in his letter to Baucus and Hatch.