MidPac's tax lien is 3 times more than the total delinquent property taxes on 11,000 land parcels
By Johnnie Rosario
If every person listed on 76 pages of the delinquent property tax list paid three times more than the taxes they owe GovGuam, it still wouldn't cover the amount of cigarette taxes just one taxpayer was assessed in a June 2018 tax lien.
According to Department of Revenue and Taxation director Dafne Shimizu, the total amount in delinquent property taxes equals $4.28 million covering "10,940 Parcel Identification Numbers."
A June 2018 tax lien on MidPac shows the company owed at least $14.7 million in cigarette taxes that it collected from its customers between April 2014 and March 2017, but never turned in to the government of Guam. The amount is a discount on what the actual tax liability was. DRT, which at the time was run by the Calvo administration, negotiated a tax settlement allowing MidPac to enter into a payment plan at a reduced tax liability.
MidPac is owned by the Calvo family.
It has never been publicly disclosed whether the company has made good on the terms of the tax settlement. Neither has that tax settlement agreement ever been made public.
The cigarette tax is $4 per pack of cigarettes. That cost is built in to every pack that is sold on store shelves, which means when you buy a pack of cigarettes, you've already paid the tax. The cigarette distributor is supposed to remit that payment to the government of Guam. Once that tax is paid to GovGuam, it goes into the Healthy Futures Fund, the primary beneficiary of which is Guam Memorial Hospital.
The property tax is assessed on private land owners. Once collected it goes into the Territorial Education Facilities Fund. Both GMH and the capital improvements needed for public schools are grossly underfunded.
On July 27, 2018, Gaynor Daleno in the Guam Daily Post quoted MidPac president John Calvo as saying the allegations of cigarette smuggling (an entire topic on its own that we'll get to) are entirely false. Calvo said that in 2017, "MidPac discovered issues with its reconciliation of tobacco taxes and unilaterally brought the matter to the attention of the Department of Revenue and Taxation. As a result of MidPac's voluntary notice, DRT reviewed the situation, assessed MidPac for additional taxes and then agreed to an installment plan involving substantial initial payments," as well as monthly payments in addition to MidPac's regular ongoing excise tax payments.
Property owners, who fail to pay their taxes, risk the government seizing the land in lieu of the taxes, if the taxes haven't been paid over a certain time period.