Senators override governor's veto of Guam's 2026 budget bill

By Pacific Island Times News Staff

The 38^th Guam Legislature on Monday voted 11-4 to override Gov. Lou Leon Guerrero’s veto of the 2026 budget bill, which rolls back the business privilege tax—the main source of friction between the Republican-led chamber and the Democratic administration.

Bill 44-38, which set the spending level at $1.36 billion, takes effect on Oct. 1.

“The successful override of the veto of Bill 44-38 marks a pivotal step in ensuring Guam’s fiscal health and advancing the interests of every man, woman and child who calls Guam home,” Speaker Frank Blas Jr. said.

“Your 38^th Guam Legislature has demonstrated leadership by holding the line both on spending and in reducing taxes for our people – putting more money directly into the hands of Guam’s families and empowering them to invest in their future.” 

Bill 44-38 rolls back the BPT from 5 percent to 4.5 percent starting Oct. 1, and then it drops to 4 percent on Oct. 1, 2026.

This was the first successful rollback initiative since the BPT was raised in 2018, supposedly as a temporary stopgap measure to bridge the funding gap created by the federal tax cuts during Donald Trump’s first term.

Smarting from the override, the governor said the bill strips $40 million from government revenues in FY26 and guarantees another $80 million loss in FY27.

“That is $120 million taken away from the resources we use to pay for healthcare, education, and public safety in just two years,” Leon Guerrero said.

“This override is not just a legislative victory: it is a reaffirmation that the people’s voice guides governance,” said Sen. Christopher M. Duenas, Chairman of the Committee on Appropriations. “Democracy has prevailed, and we are building a government that delivers real results for Guamanians.”

Sen. Shawn Gumataotao said the override vote was taken with great care and consideration for a common-sense policy that benefits both the public and private sectors.

“The time for budget preparation talk is now behind us-budget action must now take place for the next 12 months,” Gumataotao said.

He added that the bill “represents this legislature’s pledge to prioritize long-term economic recovery over growing an already unsustainable bureaucracy.”

Sen. Jesse Lujan described the legislative action as "a defining moment" for Guam. “We stood firm, we fought hard, and we delivered for the people of Guam," he said. 

He listed the $10 million appropriation for the Guam Visitors Bureau’s airline incentive program as one of the salient features of the bill.

“This funding is a game-changer,” Lujan said. “It positions Guam as a competitive destination and strengthens our partnerships with global carriers.”

For Guam’s business community, Lujan said the BPT cut will provide "much-needed relief" to local entrepreneurs and job creators.

“I first introduced this same measure, Bill 3-37, in the 37th Guam Legislature to reduce the BPT, but under a Democrat majority it never saw the light of day,” Lujan said.

The governor, for her part, said the Republicans "delivered an $80 million gift to the largest corporations over the next 12 months," while government services "will likely suffer."

"The damage doesn’t stop there. By eliminating recurring revenue, this budget risks triggering a negative credit action," Leon Gurrero said.

"That means every new school, every hospital upgrade, and every infrastructure project Guam needs could cost more to finance. At the very moment we must strengthen our future, Republicans have made it more expensive."

The Guam Chamber of Commerce, which has relentlessly advocated for tax relief, said the BPT rollback "is a statement that Guam values its private sector as the engine of growth. Lowering the burden on businesses allows them to reinvest in jobs, wages, and expansion, which would create ripple effects that strengthen our economy and, ultimately, government revenues.  

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