Guam’s congressman pushes against local corruption favoring cigarette distributors

Updated: Oct 14, 2019


By Troy Torres


(Tumon, Guam) Congressman Michael San Nicolas has introduced House Resolution 4635, which will federalize the enforcement of cigarette business following the local government's failure to do anything about the local problem.


Mr. San Nicolas's measure follows Governor Lou Leon Guerrero's inability to collect at least $14.3 million owed by Calvo-owned MidPac distributors. The company received a tax settlement from an exponential tax payable during the Calvo administration. Ms. Leon Guerrero has chosen to go after much smaller businesses and citizens while neglecting to collect on this huge receivable and while giving tax settlements to at least two wealthy businessmen connected to her Administration. Meanwhile, the governor has refused to support the ending of the 25 percent business privilege tax that hurts the poor and working classes most. She said she wants the increase to remain forever.


Mr. San Nicolas slammed the governor's administration, stating that if she doesn't do anything to implement the laws in place to safe guard taxpayers, he will.


The information on this measure is contained in an eloquently written release from the Congressman's office. We prefer to present this release in its entirety below:


For Immediate Release


San Nicolas moves to end cigarette smuggling on Guam


After over a year without implementation of local law mandating cigarette tax stamps, Congressman San Nicolas introduced HR 4635 to assert federal authority over cigarette smuggling on Guam.


HR 4635 amends Title 18 of the U.S. Criminal Code to include Guam under federal jurisdiction for cigarette enforcement.


In the 34th Guam Legislature it was uncovered that up to 98 million cigarettes were unaccounted for in local tax rolls, resulting in $14.6 million in uncollected cigarette tax revenues.


"As a Guam Senator I passed local law mandating tax stamps to end apparent tax evasion and cigarette smuggling on Guam; however this local law remains unenforced, and the people of Guam do not deserve to be shortchanged by a failure to enforce local law," opened Congressman San Nicolas.


"The $14.6 million in uncollected cigarette taxes would have funded GMH, cancer treatments, and programs to address addictions," said Congressman San Nicolas. "Failure to collect adds to our deficits, and unfairly reinforces arguments to raise taxes on everyone else because a select few get away with not paying what is owed," Congressman San Nicolas added.


If passed, the Federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF) and other federal agencies will be able to act on cigarette smuggling activities and adjudicate violations with the Guam U.S. District Attorney.


"When we have local laws on our books to resolve our problems local leaders have an obligation to act. This is one of several examples we have seen where local laws go unaddressed at the expense of the people of Guam, and we will act as necessary to end this form of corruption," Congressman San Nicolas concludes.


<HR 4365 follows>





536 views1 comment