Guam § 71114 - Withholding Assessment Fee Requirement for Government

§ 71114. Withholding Assessment Fee Requirement for Government

Contracts; Off-Island Businesses Without Guam Business License.

(a) For the purposes of this Section, the following shall mean:

(1) Non-resident person means a person or body who is not a

permanent resident of Guam, or a business that does not possess a

valid Guam business license under Title 11, Guam Code Annotated,

and does not pay Business Privilege Taxes under Chapter 26 of Title

11, Guam Code Annotated, and includes any individual, firm, co-

partnership, joint venture, association, corporation, estate, trust,

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limited liability company, limited partnership, limited liability

partnership, or any other group or combination, as a foreign entity

outside of Guam, acting as a unit.

(2) Professional services or services means any kind of

services rendered by a non-resident person and includes, but is not

limited to, legal, promotional, advertising, public awareness,

architectural and engineering services, or other services deemed

applicable in the opinion of the Director of the Department of

Revenue and Taxation.

(b) (1) There is established a withholding assessment fee for a

non-resident person without a valid Guam business license, which

shall be equal to four percent (4%) of the total dollar value of a

contract awarded for all government of Guam contracts for

professional services provided by a non-resident person residing

outside of Guam, as a cost of doing business with the government of

Guam.

(2) This Section shall apply as a mandatory requirement of a

government of Guam contract being awarded to provide

professional services required by any government of Guam agency,

to include all autonomous agencies.

(3) All agencies, to include autonomous agencies, of the

government of Guam shall ensure that all Requests for Proposals

(RFP), Invitation for Bid (IFB), or any other form of solicitation for

professional services, include the notification to potential offerors

that the award and issuance of a contract to provide the professional

services is subject to the withholding assessment fee for contracts

awarded to persons without a valid Guam business license.

(4) The agency awarding the contract or the agency’s

representative awarding the contract shall, at the time of a contract

award, in the instance of a contract for professional services to a

person who does not possess a valid Guam business license under

Title 11, Guam Code Annotated, and who is not a resident of Guam,

deduct from funds allocated for the contract an amount equal to four

percent (4%) of the total dollar value of a contract awarded, and

shall transmit the funds to the Treasurer of Guam for deposit in the

General Fund. The amount of the withholding assessment fee

withheld pursuant to this Section shall be duly noted in the payment

statements to the contractor. The agency shall report to the

Department of Revenue and Taxation (DRT), on forms prescribed

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by the Department, the amount of the withholding assessment fee

withheld, or any other information requested by DRT on the

prescribed form, from the awarded professional services contract

within thirty (30) days of the contract being awarded.

(c) Prospective Applicability. The withholding assessment fee

pursuant to this Section for a non-resident person without a valid Guam

business license shall not be applicable to any contract for professional

services entered into with the government of Guam prior to the effective

date of this Act; provided, however, that it shall be applicable for the

award of a new contract or contract renewal for the contractual provision

of the same or similar services.

(d) Withholding Assessment Fee Collected Declared Government

of Guam Funds. The withholding assessment fee levied, assessed and

collected under this Chapter shall become funds of the government of

Guam from the moment of collection and shall be subject to all laws,

rules and regulations pertaining thereto, and unless specifically provided

by law, all such withholding assessment fees collected shall be deposited

into the Treasury of Guam as part of the General Fund.