TAX INCENTIVE BILL AIMS TO ENCOURAGE ECONOMIC GROWTH IN NORTHERN MARIANAS

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By Jojo Dass

SAIPAN, Northern Mariana Islands (December 29, 2000 - Marianas Variety/PINA Nius Online)---Legislation that would grant businesspeople a 100 percent tax rebate for 25 years to encourage economic growth is headed to Governor Pedro P. Tenorio for approval.

The House of Representatives accepted the Senate's amendments to the bill, which proposes to encourage new and old investors developing "desirable facilities or activities" in the Northern Marianas.

The House's original version only covered businesses in the hospitality sector. The Senate expanded its coverage to include businesses already in the commonwealth as well as new investors engaged in the software industry.

If enacted into law, several new investors, who according to the House have been waiting in line to see the legislation passed, can finally come in to begin doing business. The investors include two hotel companies, a software firm and a peanut butter manufacturer.

House Floor Leader Oscar M. Babauta, R-Saipan, expressed hope that Tenorio will approve the legislation soon.

"We encourage the governor to review such legislation and give it the thumbs up in the coming days. I'm sure the governor is very cognizant of our economic conditions," said Babauta.

He said Tenorio has been "playing a vital role" on the legislation and has been communicating with the Legislature regarding the matter.

Babauta also said that the House welcomes the Senate's inclusion of software companies in the legislation, considering recently passed legislation creating free trade zones in the Northern Marianas.

"That will augment the programs in giving incentives for potential investors such as the software companies," he said.

The legislation requires the Commonwealth Development Authority to screen applicants for tax incentives and make recommendations to the governor who, for his part, will still have to review the company's credentials before tax rebates may be granted.

The legislation also sets a minimum capital investment requirement for new investors as well as those expanding their current business establishments.

The governor may grant a 100 percent rebate for 25 consecutive years or a 50 percent rebate for up to 50 years.

Pacific Islands News Association (PINA) Website: http://www.pinanius.org 

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