Congressman Faleomavaega announced that by a vote of 79 to 9 the U.S. Senate passed H.R. 6111, the Tax Relief and Health Care Act of 2006, which includes a two-year extension of 30A tax credits for American Samoa’s canneries. Yesterday, the House passed the same bill by a vote of 367 to 45.
“The Senate accepted the House version as is meaning that this bill will now go directly to the President for signature, and our extension will become a matter of law before the year ends,” Faleomavaega said. “On December 8th, immediately after the House passed our tax extensions at 3:38 p.m., I placed a call to Senate Majority Leader-elect Harry Reid and requested his support. He assured me that the Senate would be working through the night and into the early morning of December 9th and that our bill would be taken up during this time.”
“At about 1:27 a.m. on December 9th, the Senate passed H.R. 6111 and I once again thank both our Democratic and Republican friends for working with us to get this deal done. I also thank our canneries for accepting the 30A compromise I offered as an alternative to section 936 tax credits. The benefits are almost identical and both, in fact, include wage credits.”
“30A is the sum of (1) 60% of wages and fringe benefits and (2) 15%/40%/65% of depreciation allowances for short-life/medium life/long-life tangible property. This is in section 30A(d) which is the same as section 936(a)(4). The only difference is how the claim is made,” Faleomavaega said. “Section 936 allows our canneries to claim a tax credit based on either profits or wages. Chicken of the Sea uses the profit credit and StarKist uses the wage credit.”
“Under section 30A, our canneries would be required to make their claims based on wage credits. Since StarKist is already doing this, 30A is no change for them. As for Chicken of the Sea, it determined that it is better for StarKist and COS to use the same methodology for determining possession income and therefore welcomed 30A as a perfect alternative that will give our canneries the same benefits as 936 without the negative political connotation.”
“Now that 30A is on its way to being signed into law, I look forward to working with our canneries and local leaders and businesses to develop a long-term tax policy that meets the demands of the global tuna market while attracting other businesses and encouraging further investment in the Territory. I also continue to be hopeful that our local government will take a serious look at the report issued by the American Samoa Economic Development Commission and present to Congress a unified plan for economic development.”
“Finally, I once again thank our friends and allies for their support in extending our tax credits. Chairman Thomas of the House Committee on Ways and Means was the right man at the right time to champion our cause. Ranking Member Rangel of Ways and Means was also critical to our success. On the Senate side, I thank Chairman Charles Grassley and Ranking Member Max Baucus of the Senate Finance Committee for their support and also Senator Orrin Hatch. As always, Senators Daniel Inouye and Daniel Akaka have been our loyal allies throughout this process.”
“Above all, I thank the people of American Samoa for sticking with me as we have navigated difficult waters and worked together to protect our economy and the jobs of more than 5,000 cannery workers. It is with deep humility that I wish each of you a Merry Christmas and Happy New Year,” Faleomavaega concluded.