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HAGATNA, GUAM – The Guam Chamber of Commerce stands aligned with other business organizations in strongly supporting the reduction of the Business Privilege Tax (BPT) to 4%. This effort, coupled with the responsible reduction of government spending, represents a critical step toward a stronger economy. We commend the majority of Senators in the 38th Guam Legislature who courageously introduced and supported a two-tier approach to this reduction.
Under the proposed Fiscal Year 2026 budget, if enacted as is, the BPT would decrease from 5% to 4.5% on October 1, 2025, and then to 4% on October 1, 2026. Such changes will provide real relief to businesses and stimulate economic activity across the island.
What is frustrating, however, is the political theater surrounding this issue. Some Senators appear more focused on grabbing headlines, while certain voices in the Executive Branch are suddenly forecasting financial doom, despite boasting of seven straight years of government surpluses. The truth is, the budget is still being debated, and it is premature and irresponsible to pin every government problem on a BPT reduction that has yet to even take effect.
Take, for example, the issue of school buses. The long-standing challenges of driver shortages and poorly maintained vehicles predate this bill. The government has had years, alongside a 5% BPT rate, federal dollar investment, as well as budget surpluses, to fix this problem; however, it chose not to. To now blame potential BPT reductions for students not getting to school on time is disingenuous. The government must do better.
Critics warn that the BPT reduction will starve the Guam Department of Education (GDOE ) of resources, yet Republican Senators have learned that the department has lapsed $50 million in local funds over the past three fiscal years alone, and earlier this year returned over $100 million in unused federal dollars. GDOE’s problem isn’t a lack of money, it’s a lack of prioritization and accountability. Unless the department addresses procurement inefficiencies and spending discipline, increasing revenue will not fix its dysfunction.
Similarly, some are blaming the condition of Guam Memorial Hospital (GMH) on a potential BPT reduction. We thank Senator Sabrina Salas-Matanane, chairwoman of the Healthcare Committee, for pointing out $35 million in unspent funds that were previously appropriated to fix hospital infrastructure. Despite the administration claiming healthcare as a top priority, GMH has been left to dry, even after seven years of a 5% BPT rate. Clearly, the issue is not the tax rate, but government mismanagement.
Even more troubling are efforts by certain Senators to penalize local contractors by targeting those working on federally funded projects with higher taxation. This approach is not only unconstitutional, but it also imposes a form of double taxation on Guam-based subcontractors—many of them small, family-owned businesses. While one Senator calls the military buildup a “once-in-a-generation opportunity,” she overlooks the fact that it has already sustained local jobs, grown small businesses, and generated substantial revenue for GovGuam across multiple tax streams. During the pandemic, the build-up activity was the only thriving sector and helped keep government payrolls funded. Attempts to discourage this economic engine are shortsighted and harmful.
Moreover, such discriminatory tax policies risk scaring off future investors in Guam, affecting not just the buildup, but also tourism and other industries critical to our economic diversification. Legislation should aim to support a pro-growth, business-friendly environment, not set reckless precedents that damage Guam’s reputation as a place to invest and operate.
Throughout this budget process, theatrics, delay tactics, and political grandstanding have distracted from the serious responsibility at hand. A small group of Senators, under the guise of serving the “little people,” has instead vilified businesses, the very entities that create jobs, pay taxes, and keep our economy running. Many of those businesses are precisely the “little people” they claim to defend.
The Guam Chamber of Commerce stands firmly beside the Senators who have approached this process with professionalism, determination, and genuine concern for the island’s economy. By working diligently to pass a responsible budget while advancing the phased reduction of the BPT, they are demonstrating true leadership. Their commitment will provide direct relief to the business community, spur economic activity, and ultimately benefit every resident of Guam.
To those Senators, we say thank you. Stay resolute. The people of Guam are watching—and we stand with you.
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August 20, 2025
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