As the United States Senate debates whether to pass a tax reform bill, the tiny territory of American Samoa is hoping a proposed tax credit extension will stick with the proposed legislation.
U.S. Delegate Aumua Amata, America Samoa’s non-voting congressional representative, said extending the American Samoa Economic Development Credit is a needed to entice investment and keep jobs in the southern Pacific territory that relies heavily on the seafood industry.
Amata’s provision seeks to extend the credit through 2022. The House of Representatives passed the bill on 16 November.
“We’re pleased to not only get our request for an extension of the tax credit itself, but also add economic stability by expanding it to six years for better business planning,” said Amata in a statement a day after the vote. “So far, it’s encouraging news for American Samoa and we’ll keep working through completion of the entire legislative process.”
Tuna dominates the American Samoa economy, representing 93 percent of the territory’s total exports. The territory is also home to two tuna canneries that employ about 13 percent of the territory’s workforce.
Amata cited a U.S. Department of Labor report from 2007 that said without the credit, companies could be forced to relocate.
StarKist, owned by Dongwon Industries, currently employs about 2,300 workers in American Samoa for processing and canning. Andrew Choe, StarKist's president and chief executive officer, told the Wall Street Journal the tax credit was “very critical" for the company to continue operating in the territory.
"This credit does help us to stay competitive,” Choe said.
Senate leaders are currently reviewing and amending the bill. If the credit is not included in the version the Senate passes – although passage there is not guaranteed – it could be brought back into through the committee process before it goes to U.S. President Donald Trump for his signature.
“Ensuring the renewal of this economic development credit has been an ongoing priority to preserve jobs and promote investment in American Samoa,” Amata said. “It’s important that our federal tax policy reflects an understanding of American Samoa’s unique economic needs.”