Chapter 28

11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 1 CHAPTER 28 USE TAX LAW § 28101. Definitions, Generally. § 28102. Same: Use, Consumption, Defined. § 28103. Levy of Tax. § 28104. Rate of Tax. § 28105. Persons Taxable; Computation of Tax; Payab le When. § 28106. Exemptions. § 28107. Tax in Addition to other Taxes. § 28108. Returns. § 28108.1. Payment of Use Tax § 28109. Reports by Importers and Others. § 28110. Collection of Tax by Seller; Penalty. § 28110.1. Failure to Supply Identifying Number § 28111. Other Provisions of Chapter 26 Applicable. § 28112. Continuing Appropriation. § 28101. Definitions, Generally. Whenever used in this Chapter, unless otherwise req uired by the context: (a) Cargo means any load of commodities carried by ship or aircraft that has a bill of lading or maste r airway bill. (b) Luggage means any suitcase, trunk or container used to carry personal items while traveling. (c) Import (or any nounal, verbal, adverbial, adjective or other equivalent of the term) includes importation into Guam from any other part of the United States or its pos sessions or from any foreign country, whether in interstate or foreign commerce, or both.

er equivalent of the term) includes importation into Guam from any other part of the United States or its pos sessions or from any foreign country, whether in interstate or foreign commerce, or both. (d) Person includes any individual, firm, copartnership, joint venture, association, corporation, trust or a ny group or combination action as a unit, and the plural as wel l as the singular number as may be appropriate. (e) Property means tangible personal property, but does not include newspapers or other periodical publicat ions COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 2 purchased on the subscription plan, issued at state d intervals as frequently as four (4) times a year. (f) Purchaser means any person purchasing property, but does not include the government of Guam, or the United States, its wholly owned agencies or instrumentalit ies, or any person immune from the tax imposed by this Chapter under the Constitution and laws of the United States. (g) Representation refers to any or all of the following: (a) a seller’s being present in Guam, and (b) a seller’s having in Guam a salesman, com- mission agent, manufacturer’s representative, broke r or other person who

fers to any or all of the following: (a) a seller’s being present in Guam, and (b) a seller’s having in Guam a salesman, com- mission agent, manufacturer’s representative, broke r or other person who is authorized or employed by such seller to assist such seller in selling property fo r use or consumption in Guam, by procuring orders for such sales, making collections or deliveries or otherwis e, and (c) a seller’s having in Guam a person upon whom process directed to such seller from the courts of Guam may be served. (h) Seller , as used in §§ 28107 and 28110, means any person engaged in the business of selling tangible personal property, wheresoever engaged, and any person autho rized by a seller to collect the price, but does not incl ude the United States or any of its departments or wholly owned ag encies, the government of Guam, or any person who, under th e Constitution and laws of the United States, is immu ne from the duty, imposed by § 28110, of collecting the tax . (i) Taxpayer means any person liable for any tax hereunder, and where the taxable use of the propert y is not to be or is not made by the owner thereof, then both t he person making such use and such owner

xpayer means any person liable for any tax hereunder, and where the taxable use of the propert y is not to be or is not made by the owner thereof, then both t he person making such use and such owner shall be deemed the taxpayers taxable under this Chapter, and both shal l be jointly and severally liable for such tax. (j) Value, means fair and reasonable cash value at the time of accrual of the tax. (k) Commissioner means the Commissioner of Revenue and Taxation, Department of Revenue and Taxation, COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 3 Government of Guam. (l) Transient Visitor means a person who is on Guam for not more than three (3) months consecutively or six (6) months within one (1) calendar year, and does not i nclude those persons who have voted or for other purposes maintained official residency outside of Guam but a re in Guam for six (6) months or longer under employment contracts whereby they are employed within the terr itory of Guam. (m) Contractor means a person who contracts to erect, construct, repair, or improve buildings, highways, and other structures and includes those engaged in the practi ce of architecture, professional engineering,

r means a person who contracts to erect, construct, repair, or improve buildings, highways, and other structures and includes those engaged in the practi ce of architecture, professional engineering, land survey ing, landscape architecture, and pest control or fumigat ion. A contractor is any person or business making repairs , alterations or additions to real property. For purp oses of discussion, the term contractor means construction contractor. (n) Construction Equipment means light and heavy, off- road and on-road, gas, diesel, electric or other po wered equipment or tools. (o) Landed value means the greater amount between the insured value or fair market value the item has at the time it arrives on Guam, based on industry standards used t o assess items. SOURCE: GC § 19600. Amended by P.L. 25-41:1,2. Subsectio ns (m),(n) and (o) added by P.L. 31-077:XII:37(b) (Sep t. 20, 2011). § 28102. Same: Use, Consumption, Defined. Wherever used in this Chapter, unless otherwise req uired by the context, use or consumption (and any verbal, adjective, adverbial and other equivalent from of any of these terms), herein used interchangeably, means any use, whether such u se is of such nature

the context, use or consumption (and any verbal, adjective, adverbial and other equivalent from of any of these terms), herein used interchangeably, means any use, whether such u se is of such nature as to cause the property to be appreciably c onsumed or not, or the keeping of such property for such use or con sumption; but shall not include: (a) the sale or the keeping solely for the sale of such property. COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 4 (b) the use or keeping for use of property as mater ial which is or is to be incorporated by the taxpayer i nto a finished or saleable product, including the contain er or package in which the product is contained during th e course of its preservation, manufacture or processing, inc luding preparation for market, and which remains or will r emain in such finished or saleable product in such form as t o be perceptible to the senses, and which finished or sa leable product is or is to be sold and not otherwise used by the taxpayer. (c) temporary use of property, not of a perishable or quickly consumable nature, where such property is i mported into Guam for temporary use (not sale) therein by t he person importing the

taxpayer. (c) temporary use of property, not of a perishable or quickly consumable nature, where such property is i mported into Guam for temporary use (not sale) therein by t he person importing the same and is not intended to be, and is not , kept permanently in Guam (as for example without limitin g the generality of the foregoing language): (1) in the case of moving picture films imported fo r use in theaters in Guam with intent or under contra ct to transport the same out of Guam after completion of such use; (2) in the case of a transient visitor importing an automobile or other belongings into Guam to be used by him while therein but which are to be and are remov ed upon his departure from Guam. (d) use by the taxpayer of property acquired by him solely by way of gift. (e) use which is limited to the receipt of articles and the return thereof, to the person from whom acquired, immediately or within a reasonable time either afte r temporary trial or without such trial. (f) use of goods imported into Guam by the owner of a vessel or vessels or of an aircraft or aircrafts en gaged in interstate or foreign commerce and held for and use d only for repair or replacement of said

of goods imported into Guam by the owner of a vessel or vessels or of an aircraft or aircrafts en gaged in interstate or foreign commerce and held for and use d only for repair or replacement of said vessels or aircrafts or as ship or aircraft stores for such vessels or aircraft. (g) the use or keeping for use of materials or com- modities which are to be incorporated by a contract or into the COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 5 finished work or project required by the contract a nd which will remain in such finished work or project in suc h forms as to be perceptible to the senses. (h) the use or keeping for use of household goods, personal effects and private automobiles imported i nto Guam for nonbusiness use by a person who (1) acquired th em in another state, territory, district or country, (2) at the time of such acquisition was a bona fide resident of anothe r state, territory, district or country, (3) acquired the pr operty for use outside Guam, and (4) made actual and substantial u se thereof outside Guam; provided, that, as to an arti cle acquired less than three (3) months prior to the time of its importation into Guam it shall be presumed,

d (4) made actual and substantial u se thereof outside Guam; provided, that, as to an arti cle acquired less than three (3) months prior to the time of its importation into Guam it shall be presumed, until and unless cl early proved to the contrary, that it was acquired for us e in Guam and that its use outside Guam was not actual and su bstantial. (i) the use or keeping for use of property by a bon a fide farmer engaged in agriculture in Guam and used or h eld for use only for agricultural purposes. SOURCE: GC § 19601, Subsection (i) added by P.L. 10-87; su bsection (f) amended by P.L. 21-12:1. P.L. 31-077:XII:37(c) (Sept. 20, 2011), repealed Subsection (c)(1) and renumbered subsectio ns (c)(2) and (c)(3) appropriately. § 28103. Levy of Tax. There is hereby levied on the landed value of, and shall be paid and collected, in the manner, at the times, an d by the persons, hereinafter provided a use tax upon the use or cons umption of all property (as hereinabove defined) in Guam. SOURCE: GC § 19602. Amended by P.L. 31-077:XII:37(d) (Sep t. 20, 2011). § 28104. Rate of Tax. The rate of the tax hereby imposed shall be four pe rcent (4%).

roperty (as hereinabove defined) in Guam. SOURCE: GC § 19602. Amended by P.L. 31-077:XII:37(d) (Sep t. 20, 2011). § 28104. Rate of Tax. The rate of the tax hereby imposed shall be four pe rcent (4%). Effective April 1, 2003, the rate of the tax hereby imposed shall be six percent (6%) through March 31, 2004, after w hich the rate shall revert to four percent (4%). SOURCE: GC § 19603. Amended by P.L. 27-05:V:8. Amended by P.L. 27-76:7. COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 6 § 28105. Persons Taxable; Computation of Tax; Payab le When. Every person who imports into Guam, or acquires in Guam from any other person to taxable under 11 GCA, Chap ter 26, in respect to the transaction by which the former acqu ired the same, any property for his use or consumption, shall be subject to a tax in respect to such use or consumption at the rate i n this Chapter provided, measured by the landed value of such prop erty, which tax shall be payable: (a) In the case of property imported in foreign commerce, at the time such property loses its chara cter as an import and its immunity as such from taxation by th e government of Guam; (b) In the case of property imported in

ty imported in foreign commerce, at the time such property loses its chara cter as an import and its immunity as such from taxation by th e government of Guam; (b) In the case of property imported in interstate commerce, at the time such property comes to rest i n Guam and ceases to have its character as an article in i nterstate commerce; and (c) In the case of property acquired otherwise than through importation into Guam by the taxpayer in fo reign or interstate commerce, at the time of such acquisitio n; (d) In the event that the tax may not legally be le vied in respect to the property concerned at the time and u nder the circumstances provided in Paragraphs (a), (b) or (c ) of this Section, the tax shall be levied and become payable at the commencement by the taxpayer of any use or consumpt ion of the property which is taxable by the government of Guam. (e) The Guam Customs and Quarantine Agency shall collect the use tax mandated by this chapter on beh alf of the Department of Revenue and Taxation on: (1) taxable property which comes in at the Guam Commercial Port, or any other seaport in Guam, with any tax for which an exemption is not claimed, to b e collected prior to

f Revenue and Taxation on: (1) taxable property which comes in at the Guam Commercial Port, or any other seaport in Guam, with any tax for which an exemption is not claimed, to b e collected prior to release; (2) taxable property which comes in as freight or unaccompanied baggage at the A.B. Won Pat International Airport, or any other airport in Guam ; and COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 7 (3) taxable property which comes in as accom- panied baggage at the A.B. Won Pat International Airport, or any other airport in Guam. (f) The Director of the Department of Revenue and Taxation is authorized to promulgate rules and regu lations in accordance with the Administrative Adjudication Law to enforce the intent of this law within 90 days of en actment of this Act. (g) The Customs and Quarantine shall collect the Use Tax on construction equipment for the performance o f a construction contract as mandated by this Chapter, and will maintain a database of the inventory of taxed equip ment to reconcile with tax collected. The value of property at the time the tax first bec omes payable in respect thereof, shall be the value used for the computation of the tax.

ntory of taxed equip ment to reconcile with tax collected. The value of property at the time the tax first bec omes payable in respect thereof, shall be the value used for the computation of the tax. SOURCE: GC § 19604. Subsections (e), (f), and (g) added by P.L. 24- 14:5. Subsection (g) repealed by P.L. 24-059:III:2 1. P.L. 31- 077:XII:37(e) (Sept. 20, 2011), amended the first p aragraph and added subsection (g). § 28106. Exemptions. The tax imposed by this Chapter shall not apply to: (a) Any property, or to any use or consumption of s uch property, which cannot be legally so taxed under th e Constitution or laws of the United States, but only so long as, and only to the extent to which, the government of Guam, is without power to impose such tax; and (b) Any person in respect to property acquired in o r imported into Guam by him prior to July 1, 1967; (c) Any use or consumption of personal property the transfer of which property to, or the acquisition o f which by, the person so using or consuming the same has actua lly been or actually is taxed or exempted under Title 11 GCA , Chapter 26.

erty the transfer of which property to, or the acquisition o f which by, the person so using or consuming the same has actua lly been or actually is taxed or exempted under Title 11 GCA , Chapter 26. (d) When a tax has been imposed under this Chapter it shall not again be imposed upon or in respect to th e same COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 8 property under this Chapter; but nothing in this Ch apter shall be construed to exempt any property or its use or consumption from taxation under any other law. (e) the personal non-business use or keeping for personal non-business use of any property of One Th ousand Dollars ($1,000) value or less, acquired outside Gu am during any one (1) month period, for a maximum of Five Tho usand Dollars ($5,000) per any given calendar year, by an individual who is a bona fide resident of Guam at t he time of the acquisition. (f) Property belonging to and being brought into Gu am by residents returning to Guam after completion of studies under government scholarships or in-service trainin g is exempted from the provisions of this Act.

belonging to and being brought into Gu am by residents returning to Guam after completion of studies under government scholarships or in-service trainin g is exempted from the provisions of this Act. (g) All property imported into Guam by a FSC which is 'non-Guam property' as defined in 12 GCA §2431(d). (h) All Passenger Luggage. Cargo traveling with a passenger is not exempt from the provisions of this Chapter. (i) Any medical equipment, machines, or appliances, including beds, examination or treatment chairs, or telemedicine technology for use in hospitals or cli nics. Clinics, for purposes of this Subsection, include t hose operated by healthcare professionals, licensed unde r the provisions of 10 GCA Chapter 12, who accept Medicar e, Medicaid, and Medically Indigent Program (MIP) pati ent coverage when applicable. SOURCE: GC § 19605, Subsection (g) added by P.L. 17-63. Su bsection (e) amended by P.L. 20-221:64(b). Subsection (h) ad ded by P.L. 25-41:3. Subsection (i) added by P.L. 36-045:3 (Aug. 16, 202 1). § 28107. Tax in Addition to Other Taxes. The tax imposed by this Chapter shall be in additio n to any other taxes imposed by any other laws of Guam, exce pt as other- wise

36-045:3 (Aug. 16, 202 1). § 28107. Tax in Addition to Other Taxes. The tax imposed by this Chapter shall be in additio n to any other taxes imposed by any other laws of Guam, exce pt as other- wise specifically provided herein; provided, that i f it be finally held by any court of competent jurisdiction, that t he tax imposed by this Chapter may not legally be imposed in addit ion to any other tax or taxes imposed by any other law or laws with respect to the same property or the use or consumption ther eof, then this COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 9 Chapter shall be deemed not to apply to such proper ty and the use or consumption thereof under such specific circumst ances, but such other laws shall be given full effect with res pect to such property, use and consumption. SOURCE: GC § 19606. § 28108. Returns. Each taxpayer against whom a tax is levied by the p rovisions of this Chapter shall make and file monthly tax ret urns with the Tax Commissioner , no later than the twentieth (20 th ) day of the following month , summarizing the tax due. The monthly return shall be filed and any tax then due shall be paid no later than the twentieth (20 th ) day

o later than the twentieth (20 th ) day of the following month , summarizing the tax due. The monthly return shall be filed and any tax then due shall be paid no later than the twentieth (20 th ) day of the following month. SOURCE: GC § 19607. Repealed and reenacted by P.L. 24-12:1 0. Amended by P.L. 27-76:8. NOTE: The effective date for filing under this amended section is for returns covering the month of April 2004 (P.L. 27-7 6:11. § 28108.1. Payment of Use Tax. All taxpayers against whom a tax is levied by the p rovisions of this Chapter shall pay Use Taxes immediately upo n the property’s importation or use. The Use Taxes shall be paid at authorized banks, financial institutions or at desi gnated offices of the government of Guam. SOURCE: Added by P.L. 24-12:11. § 28109. Reports by Importers and Others. For the purpose of enabling the Commissioner to det ermine whether or not the provisions of this Chapter are b eing complied with and to prevent evasion of the tax hereby impos ed, every person who imports any property into Guam or who ac quired property in Guam from any other person not taxable under 11 GCA, Chapter 26, in respect to the transaction by w hich the former

os ed, every person who imports any property into Guam or who ac quired property in Guam from any other person not taxable under 11 GCA, Chapter 26, in respect to the transaction by w hich the former acquired the same (whether or not he then is , or can then legally be, taxed in respect to such property or th e use or consumption thereof under this Chapter) shall make a report to the Commissioner, setting forth, in such reasonable det ail as the Commissioner by regulation may prescribe, the descr iption, quantity, character and value thereof, and such inf ormation as may be reasonably necessary to determine the taxability or non- COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 10 taxability of the person making such report in resp ect to the property covered thereby. SOURCE: GC § 19608. § 28110. Collection of Tax by Seller; Penalty. (a) Every seller having in Guam, regularly or inter mittently, any property, tangible or intangible, any place of business, or any representation (and irrespective of his having or n ot having qualified to do business in Guam), shall, if such s eller makes sales of property for use or consumption in Guam (whether or not such sales are made

ion (and irrespective of his having or n ot having qualified to do business in Guam), shall, if such s eller makes sales of property for use or consumption in Guam (whether or not such sales are made in Guam), collect from the purchaser the tax imposed by this Chapter on the use or consumption o f the property so sold by him. Such collection shall be made withi n twenty (20) days after the accrual of the tax or within such ot her period as shall be fixed by the Commissioner upon the application o f the seller, and such seller shall give the purchaser or receipt therefor in the manner and form prescribed by the Commissioner. (b) The Commissioner, in his discretion, upon appli cation therefor and under terms and conditions prescribed by him, may relieve any seller of the duty of collecting and pa ying over the tax imposed by this Chapter, if he is satisfied that th e tax can be effectively collected by other means. Exemption fro m the duty of collecting the tax may be canceled at any time when the Commissioner finds that the tax cannot be effective ly collected by other means. The Commissioner likewise may terminat e the duty and authority of any seller to collect and pay over the

ime when the Commissioner finds that the tax cannot be effective ly collected by other means. The Commissioner likewise may terminat e the duty and authority of any seller to collect and pay over the tax imposed by this Chapter if he shall find, as to such seller , that the tax cannot be effectively collected by such means. (c) The Commissioner, in his discretion, upon appli cation therefor and under terms and conditions prescribed by him, may authorize the collection of the tax imposed by this Chapter by a seller not otherwise required to collect the tax. T he seller, when so authorized, shall have the duty of collecting and p aying over the tax in the same manner and subject to the same requ irements as set out in Subsection (a). Such authority may be ca nceled at any time, when, in the judgment of the Commissioner, th e tax can more effectively be collected by other means. COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 11 (d) In case any seller required or authorized to co llect the tax under this Chapter fails to collect the same, or ha ving collected the tax fails to pay over the same as provided by t his Chapter, he shall nevertheless be personally liable to the

co llect the tax under this Chapter fails to collect the same, or ha ving collected the tax fails to pay over the same as provided by t his Chapter, he shall nevertheless be personally liable to the gove rnment of Guam for the amount of such tax, but it shall be a defen se to such liability that the indebtedness for the price is a worthless account actually charged off for income tax purposes, if and to the extent that the collections of the price do not equal the tax. (e) Every seller required or authorized to collect the tax shall make returns and payment of the tax at the same tim e and in the same manner as is provided with respect to taxpayer s by § 28108. All provisions of this Chapter with respect to retu rns, reports, records, payments, penalties and interest, appeals, investigations and audits, assessments, tax collection procedure, criminal offenses and the general administrative powers and duties of the Commissioner, shall apply to such sellers the same as to taxpayers. (f) The tax collected pursuant to this Section shal l be held in trust for the government of Guam and for payment to the Commissioner in the manner and at the time required by this Chapter.

axpayers. (f) The tax collected pursuant to this Section shal l be held in trust for the government of Guam and for payment to the Commissioner in the manner and at the time required by this Chapter. Any person collecting such tax who shall a ppropriate or cover the same to his own use or to any use other t han the payment of the tax as herein provided, and who shall fail t o pay over the amount of tax so collected at the time required by this Chapter, shall be deemed guilty of theft and may, in additio n to any other penalty provided by law, be fined not more than fiv e (5) times the amount of money so stolen and any failure by the pe rson so collecting the tax to pay the same over within the time provided by this Chapter, after demand therefor, shall be ta ken and held to be prima facie evidence of the theft. SOURCE: GC § 19609, Subsection (f) amended by P.L. 13-187. § 28110.1. Failure to Supply Identifying Number. Every person required to file returns or pay taxes, as prescribed under Sections 28108 and 28108.1 of this Chapter, shall include his taxpayer identification number on such return, statement or other document.

on required to file returns or pay taxes, as prescribed under Sections 28108 and 28108.1 of this Chapter, shall include his taxpayer identification number on such return, statement or other document. If any person fails to comply with such requirement, such person shall, unless it is s hown that such COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 12 failure is due to reasonable cause and not to willf ul neglect, pay a penalty of Fifty Dollars ($50.00) for each failure. SOURCE: Added by P.L. 24-12:12. § 28111. Other Provisions of Chapter 26 Applicable. In respect of (a) the examination of books and reco rds and of taxpayers and other persons, (b) the procedure and powers upon failure or refusal by a taxpayer to make a return o r a proper return, and (c) the general administration of this Chapter, the Commissioner shall have all the rights and powers c onferred upon him by 11 GCA, Chapter 26, with respect to taxes th ereby or thereunder imposed; and, without restriction upon t he aforesaid rights and powers all hearings and appeals shall be in conformity with the provisions of 11 GCA, Chapter 26. SOURCE: GC § 19610. § 28112. Continuing Appropriation.

out restriction upon t he aforesaid rights and powers all hearings and appeals shall be in conformity with the provisions of 11 GCA, Chapter 26. SOURCE: GC § 19610. § 28112. Continuing Appropriation. Upon enactment of this Act, and each fiscal year th ereafter: (a) Sums based on twenty percent (20%) of the total Use Tax collected in the previous fiscal year shall be appropriated to the 'Customs, Agriculture and Quarantine Inspect ion Services Fund' to cover costs associated with Use T ax collection inspection activities. This appropriatio n is continuous, but is contingent on the annual submiss ion of a detailed budget to I Liheslaturan Guåhan by the Director of the Customs and Quarantine Agency. (b) Sums based on twenty percent (20%) of the total Use Tax collected in the previous fiscal year shall be appropriated to the 'Department of Public Works Services Village Roadway Funds' to cover costs associated with improvements, repairs, and general maintenance to r oads on Guam not covered by Office of Federal Highway Funds. This appropriation is continuous, but is contingent on t he annual submission of a detailed budget to I Liheslaturan Guåhan by the Director of the DPW.

not covered by Office of Federal Highway Funds. This appropriation is continuous, but is contingent on t he annual submission of a detailed budget to I Liheslaturan Guåhan by the Director of the DPW. (c) Sums based on twenty percent (20%) of the total Use Tax collected in the previous fiscal year shall be appropriated to the 'Guam Environmental Protection Agency COL10/29/2021 11 GCA FINANCE & TAXATION CH. 28 USE TAX LAW 13 Environmental Cleanup Fund' to cover costs associat ed with preserving Guam’s natural resources. This appropria tion is continuous, but is contingent on the annual submiss ion of a detailed budget to I Liheslaturan Guåhan by the Director of the GEPA. SOURCE: Added by P.L. 25-138:4. Amended by P.L. 31-077:XI I:37(f) (Sept. 20, 2011). ---------- COL10/29/2021