New law reduces cost of small business startup
The cost of starting a small enterprise on Guam will now be less prohibitive for those with limited seed capital under a new law that reduces the business filing fee by 75 percent.
Last week, senators voted 13-1 to override the governor’s veto of Bill 133-35, which reduces the filing fees for the Articles of Incorporation of a Limited Liability Company (LLC) from $1,000 to $250.
“With our present economic climate, it is vital that we promote policies which would help enhance small business opportunities, hence create new jobs, add to our tax base, and spur our economy,” said Sen. James Moylan, author of Bill 133-35.
Moylan said the measure is designed to establish a practical policy that would open the gate for more small businesses on the island. LLC’s are the preferred structure of small businesses as it limits the liabilities of the shareholders.
“I would like to take this time to thank my colleagues for their support in overriding Bill 133-35, which is a business-friendly legislation," Moylan said.
In vetoing the bill, Gov. Leon Guerrero noted that cutting the filing fees would result in reduced revenue for the Department of Revenue and Taxation.
Moylan, however, argued that "the economics state that lowering fees would help increase LLC filings, and hence make any reduction less significant."
The new law accompanied two other previously signed measures, Public Law 118-35 and Public Law 119-35, which expand the qualifying certificate program to include commercial drone and processing-distribution industries.
“These are pieces of a larger puzzle, and there is still so much more work ahead for the 36th Guam Legislature to focus on, as the federal Pandemic Unemployment Assistance program ends in 13 days. However, this is a good start,” said Moylan, who is also the author of PL 118-35 and PL 119-35