Governor signs into law bill allowing lawmakers to claim
office expenses as taxable income
Governor Togiola Tulafono signed into law on October 31 a bill that now permits local lawmakers to claim their office expenses as taxable income.
Currently, Fono members, excluding the Swains Island delegate who earns $20,000 per year, receives an annual salary of $25,000 plus $30,000 per year in allowance. Fono leaders earn $30,000 per year in salary, in addition to $40,000 annually in allowance.
Office allowances are not taxable under local law. In past years, bills proposing to tax the allowances have been introduced in the Fono and everytime, they have failed.
This year, however, both chambers introduced their own version of the same bill but in the end, it was the House’s version that prevailed. The House bill gives lawmakers the option to tax the allowance, which is already subject to federal withholding (FICA).
Taxation of the allowance means that a lawmaker who has not yet retired can use the allowance to calculate retirement benefits.
In his letter to the Fono leaders, Governor Togiola said he appreciates the “collective wisdom and foresight of the Legislature as embodied in this bill.” He added, “This bill may provide one more stream of revenue by which the American Samoa Government may pay for the important services that we provide to the Territory.”
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