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Govt partnership with private sector is crucial for a sound economy, says CoC

Chamber of Commerce chairperson, Ella Gurr

Pago Pago, AMERICAN SAMOA — “The coronavirus pandemic is every person’s responsibility and the need to partner is more inevitable now than ever,” declared local Chamber of Commerce chairperson, Ella Gurr in the business group’s Coronavirus Economic Impact Plan submitted to the Lolo Administration more than two weeks ago.

Gurr points out that the territory’s private business sector is the largest employer in American Samoa making up 63% of the total workforce and plays a critical role to the economic backbone and stability of the territory.

The Chamber plan notes that the local government and federal government policy options are vital to weather the coronavirus pandemic. In efforts to work closely with ASG, the Chamber proposes its economic relief plan to combat the coronavirus pandemic through aggressive tax exemptions and partnerships that help support a sound economy.

Gurr said, the Chamber proposing its plan to address the Coronavirus pandemic at an “economic macro-level” for American Samoa with the least financial impact on ASG but greater impact for the economy and community.

“We are requesting to declare economic financial impact of ASG revenue to be subsidized by federal partners,” the plan states and proposed reliefs through tax exemptions for a certain period of time.

For example, defer the 4% ASG Withholding Tax for six months. “The need to allow for more disposable income directly into consumers [pockets] equates to increased consumer spending and stimulus into the economy,” the Chamber explains as the reasons for this proposal.

The Chamber’s other tax exemption reliefs and the reasons for seeking such relief include:

•     Waive Excess Tax of 8% duty effective immediately for only at the distrubution level for three-to-six months.

•     Exempt 8% tax on building supplies goods immediately.

•     Waive Port and Scanner fees for approved tax-exempt food, water and healthcare & cleaning supplies — for six months with immediate action required to be taken.

•     Increase port storage timeline impacted by increased surplus of orders, as stevedoring are reporting the need for more time to deliver goods to consumer. Currently there’s a 5-day window before fees are implemented and the Chamber recommends 10 working days before assessing fees.

•     Water Bottling Manufactures- tax exemptions on utility rate/fees for three months and require immediate action. “Consideration should be given to our local manufacturers for long-term exemptions that promote self-sustainability options for the island,” the plan states.

•     Waive the 1% alternative business minimum tax (AMBT) law for 2020.

•     Exemption of 5% occupancy tax on hotel/accommodation sectors. Declining number of travelers the past 5 months to the hotels/accommodation businesses has significantly impacted revenues to include upcoming months projections due to the coronavirus pandemic.

•     Request to review Shipping Line Port fees that are currently impacting maritime shipping industry.

The Chamber also suggests areas where ASG and the business community can establish partnerships. For example, in the accommodation industry, the Chamber requests ASG to utilize local hotels or other accommodation options as a quarantine facility in lieu of building one.

“These companies are already equipped with living quarters but are not being utilized to full capacity,” Gurr said. “This allows an opportunity to partner and keep our hotel/accommodation industry in operation to weather the coronavirus.”

For food service industry, the Chamber recommends utilizing local restaurants for food preparations and delivery services for key outreach initiatives, such as quarantine facilities or Health Department outreach programs.

On imported bottled water, the Chamber revealed that projected inbound containers of Niagara water were cancelled indefinitely due to the high demand to supply and prioritize the US domestic market.

“With the disruption of an adequate supply of [bottled] drinking water for American Samoa the need to partner with our local water bottling manufacturers is crucial,” said Gurr.

She explained that Cherith Soliai, general manager of GHC Reid Vaimalu, has confirmed they cannot meet the demand to fully supply water for the local market with their current facility.

And the Chamber reached out to Islands Choice owners, a member of Chamber on the likelihood of getting their bottling facility up and operational to assist with the local water shortage.

Islands Choice has “kindly accepted to step in during these challenging times but would need the support of ASG,” Gurr said.