Construction companies awarded contracts exceeding 150 thousand US dollars will pay a tax equal to two percent of their contracts if a bill introduced by the Senate President, Lilo Moliga, is approved.
The construction tax will be applied to both private and government funded contracts and will be inclusive of any change orders made after the original contract has been awarded.
According to the bill all revenues collected from the new tax will be given to the American Samoa Power Authority to be used solely for the collection and disposal of solid wastes.
Currently the Authority's solid waste division is subsidized by the Electric Division.
The Senate President says off-island contractors are earning millions of dollars from local construction projects and this was a way to keep some of those funds on island.