As the Guam Chamber of Commerce, we appreciate the Governor’s commitment to the people of Guam. We share her vision of a prosperous and thriving island. However, we believe a more comprehensive and balanced perspective is necessary to truly address the challenges and opportunities facing our business community and the island as a whole.

We acknowledge the progress made in recent years, particularly in fiscal management and reducing unemployment. The Governor rightly points to the resilience of our people in overcoming past crises. However, while celebrating these achievements, we must also recognize the persistent struggles and difficulties faced by many businesses and families.

On Inflation and the Cost of Living

We agree with the Governor that the rising cost of living and inflation continue to be a significant burden on our community. While we appreciate the initiatives taken to provide childcare assistance, power, and rental relief, these are temporary measures. We need sustainable, long-term solutions.

An initial solution is for the Government of Guam to be more fiscally prudent. A $1.4 billion budget is unsustainable. Guam’s economy is currently dependent on federal government investment and tourism. Without diversification, our economy is vulnerable. Today’s local private sector is not stable. We need a more pro-business effort from our government to encourage investment, innovation, and job sustainability.

The Governor mentioned that she doesn’t know anyone who feels that global inflation has declined since COVID-19. We agree, and that sentiment is especially true here in Guam, where we pay top dollar for almost every product and service.

Business Privilege Tax (BPT)

The Governor’s proposal to raise the business privilege tax (BPT) cap to $1 million is a positive step. However, we believe that a broader review of the BPT structure is needed to ensure fairness and competitiveness. While there are a number of small businesses that currently earn $500,000 or less annually and can take advantage of the 3% BPT, there are still more local businesses that do not qualify for the Dave J Santos Act and are major contributors to the local economy by providing JOBS for our residents. The Government of Guam has reported millions in revenue surplus since it raised the BPT in 2018 from 4% to 5%. This additional 25% tax prevents companies from passing revenue back to their employees or investing back into their businesses. Categorizing our companies in the same group as off-island contractors is a blow to LOCAL businesses that have been the backbone of our local economy for years. These same companies have held on to their businesses on a shoestring budget and deserve support from this government for diligently paying their taxes and barely getting by. 

The Governor stated that “those who come here to profit from our growth must be willing to pay their fair share”. We agree with this statement and believe that fairness also extends to ensuring our local businesses do not carry a disproportionate amount of the tax burden. For too long, our local companies have borne the weight of our government’s taxation by tightening spending, forgoing much-needed repairs, facilities maintenance, and overall, have been doing more with less. The Government of Guam saw exorbitant pay increases, but government services did not get any better. Our schools, public health, public transportation, and public safety services continue to cry out for more help and assistance. The Government of Guam’s workforce grew, and local businesses stagnated and, in some cases, closed completely.

Tourism: A Call for a Holistic Approach

We concur that tourism is critical to Guam's economy. The Guam Visitors Bureau’s partnership with Shinhan Card is a welcome development. However, a piecemeal approach to recovery is insufficient. Modernization is necessary, and revitalization must extend beyond Tumon to embrace the unique character and offerings of each village, ensuring sustainable and inclusive growth. We urge a comprehensive strategy, not just for attracting visitors but also for improving the overall visitor experience, including infrastructure, transportation, and broadening of customer activities.  

Instituting another hotel occupancy tax or HOT bond is not a solution to revitalizing tourism. The private sector does not have the available resources to modernize or upgrade facilities because businesses have been struggling since 2020. Instead of seeking public debt that commits the private sector to pay into the HOT tax, a tax break would go a long way in providing the private sector with the capital to improve their product. We need the government’s help - not more debt.

The Governor mentioned an increase in per diem for federal workers to stay in our local hotels. This has been made possible by the hard work of the Guam Hotel & Restaurant Association, the Chamber’s Armed Forces Committee, Congressman James Moylan’s office, and Joint Region Marianas. We thank them for their years of effort in pushing for an increase in per diem rates. While this is positive, we need to continue discussions to increase the rate further. 

The Chamber stands ready to collaborate with GVB and other stakeholders to develop and implement strategies to support tourism growth.

Federal Investment and the H-2B Visa Program

The Governor highlighted the importance of federal investment. We agree. However, we share the concern that current policies can inadvertently disadvantage local businesses and residents.

The H-2B visa issue is paramount. While federal statute already allows H-2B workers to be employed on civilian projects, not just federally contracted work, we need to continue this dialogue to expand the waiver to other industries. This is essential to addressing the labor shortages that are hindering growth in critical areas such as attainable housing. We extend a warm thank you to Joint Region Marianas, the Congressman’s office, the Chamber’s Armed Forces Committee, and our partner stakeholders for their efforts to ensure the H-2B language was included in the last NDAA. There is more work to be done, as the waiver deadline will be upon us before we know it, and broadening the workforce component will be a heavy lift in Washington DC that will require all of us to work collaboratively towards.

Housing: A Collaborative Solution Needed

The Chamber recognizes the urgent need for affordable housing. We agree that military housing allowances, as well as Section 8 allowances, have distorted the market. We support a collaborative effort involving the government, the military, and the private sector to find solutions that benefit all families in Guam. A major part of this solution is to drastically improve our permitting process. When developers cannot expect approvals in a timely manner to complete their projects, expended time adds to the cost of a project. Incentives for developers are another part of the solution. The Government of Guam can and should offer investors growth opportunities; and work in cooperation with the private sector to develop and expand its tax base.

Workforce Development: Investing in Our People

We commend the Governor's focus on workforce development. The Chamber is committed to partnering with the Department of Labor and our trades and educational institutions to provide training and apprenticeship opportunities that prepare our people for the jobs of the future.

We also need to focus on retaining our local talent. Too many of our young professionals are leaving Guam for opportunities elsewhere. We need to create an environment that attracts and retains skilled workers; however, we need help from our government leaders for tax relief so our private sector can keep people employed and pay comparable wages and benefits. 

A Call for Collaboration

The Guam Chamber of Commerce believes that a strong partnership between the government and the private sector is essential to building a better Guam. We are committed to working with the Governor, the 38th Guam Legislature, and our community partners to address the challenges and opportunities facing our island. We urge a collaborative approach to policymaking that considers the needs of all stakeholders.

We offer our expertise and resources to develop innovative solutions that promote sustainable economic growth, create jobs, and improve the quality of life for all residents of Guam. Si Yu'os Ma'ase.

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March 14, 2025

The Guam Chamber of Commerce is a non-profit voluntary association of over 400 businesses, professional individuals, and firms united in their desire to improve business and build a better social and economic community in Guam. 

Contact the Guam Chamber of Commerce at 671-472-6311/8001, email info@GuamChamber.com.gu or visit our website: GuamChamber.com.gu