Category Archives: Taxation

Tariffs Counter APEC Free Trade

By : Post Courier

THE recent moves to increase more than 900 tariffs run counter to the principles of APEC, which champions free and open trade.

This is according to the Opposition, who says the O’Neill Government should review its approach to trade as a matter of urgency so that it does not contradict priority APEC resolutions.

Shadow Minister for Treasury, Ian Ling-Stuckey, said the recent senior official’s meeting in Port Moresby highlighted APEC’s support for a rules-based, free, open, fair, transparent and inclusive multilateral trading system.

“We need to be true to APEC’s mission of ‘championing free and open trade and investment, promoting and accelerating regional economic integration,” Mr Ling-Stuckey said.

“The O’Neill Government needs to urgently review its approaches to trade as the recent moves to increase more than 900 tariffs run counter to the principles of APEC.

“We do not want to come across as hypocrites as we host this meeting, otherwise that would really be wasting opportunities from what will be an expensive summit for PNG.

“We should urgently finish the proposed second stage of the Sir Nagora Tax Review, which indicated it would look at the issue of tariffs, certainly in a more systematic and efficient manner than the recent government changes.

“We should look at better policies to get per capita growth going again and ensure the benefits are spread across our rural communities, not just some isolated projects benefitting a few.

“We need to think about getting our agricultural products to the markets of all countries in APEC, not just PNG supermarkets under protectionist barriers.

“With PNG hosting the APEC Summit in November 2018, it is important that we seize its opportunities for promoting PNG and advancing our development.

“While the Alternative Government considers that there were much better ways to promote PNG and all it has to offer, and wiser ways to invest the huge costs for the summit into health, education and infrastructure, it is now too late and it would be too embarrassing to pull out from hosting the Leaders Summit.”There are some important things we need to do to make the most of this opportunity.”

PM: Best Budget in 16yrs

By CLIFFORD FAIPARIK (The National )

 

PRIME Minister Peter O’Neill says the 2018 national budget, passed by Parliament last evening, is the best he has seen in the past 16 years, including when he served as the Treasurer.

He yesterday criticised the Opposition response to the K14.7 billion budget, calling on Shadow Treasurer Ian Ling-Stuckey to withdraw his “fake budget” remark.

“This is very disappointing as it will give a bad signal to our international investors. I’m calling on the Shadow Treasury Ian Ling- Stuckey to withdraw his statement,” he said.

“This is by far one of the best budgets that I have ever seen since I have been in this Parliament for 16 years now. That includes the budget that I have presented as well.”

O’Neill had served as a treasurer in the Sir Michael Somare-led government.

“I say this because this budget is now putting us on a course to make sure that this country’s economic base and growth will be such that it can be self-sustainable,” he said.

“So it is quite disappointing that some of the terminologies that he (Ling-Stuckey) used are unbecoming of leaders of this honourable house. We have to be careful of how we portray the image of our country, our parliament and ourselves.

“Sometimes for short political convenience and point-scoring we say things and do things that are not really in the best interest of our country. We have to be constructive.

“It’s always easy to have a blame-game going on in politics. But some of us want to move ahead and met the challenges ahead of us.”

Before it rose for the Christmas break, Parliament passed the Tax Administration Bill 2017 and the Public Money Management Bill 2017. Parliament will resume sitting on Feb 6 next year.

Parliament Debates Missing Taxes

BY JEFFREY ELAPA

The country has been missing a lot in taxes and benefits from the logging operations in the country, the National Parliament was told this week.

Members of Parliament and governors whose provinces have existing logging activities raised concerns that the people have been missing a lot from the logging operations as companies continue to evade logging taxes and other rightful benefits to the people and government.

Oro Governor Garry Juffa said many of the companies are operating criminally and often avoid paying taxes.

He said as former boss of Customs he has evidence of some of those companies who continue to evade paying taxes while many others continue to abuse the landowners using state agencies like police.

“When we entered into the look north policy, the country invited alot of people some of whom are genuine logging companies while others are not genuine but operated by criminals. Some of them manipulate the public service and political landscape,” Mr Juffa said.

“As an independent nation, we must not allow criminal companies to enter and destroy our people and our resources.”

Mr Juffa said the practice of paying royalties is something of the past, it is a colonial and outdated rule and practice and that must stop and look at make good laws through the proposed review to monitor the conduct and practice of the logging companies.

He said the provincial forest board has colluded with officers from the National Forest Authority to issue licenses to many of these rogue companies.

He said another development is good there must be a balance so that there is maximum benefit for our people.
Gulf Governor Chris Haiveta said it is high time all the agreements and law needs to be reviewed.

He said the provincial governments and landowners from timber concessional areas to be included as impacted provinces have bad experiences from logging operations in the country.

He said half of Gulf Province is engaged in logging but the benefits are minimal while many of the companies are operating illegal although their logging permits have expired some 6 years ago.

Among other issues, Mr Haiveta said in his province the log development levies have either been used to fund election while the landowners have missed out on such benefits.
He proposed other option in the review, an one of them is to consider state market option, domestic market obligation as in mining companies to be introduced.

Mr Haiveta said other option to be considered in the review must be include mandatory equity participation and review vehicle registration exemption given to the logging companies by the Department of Transport.

Raids In City

The National

By CLIFFORD FAIPARIK

A MAJOR government operation led by the Immigration Department has uncovered illegal activities conducted by some foreign-owned businesses in Port Moresby.

A team comprising officers from the PNG Customs, Labour Department, Investments Promotion Authority, National Capital District Commission, Bank of PNG and police inspected some businesses and questioned foreign workers yesterday.

The team confiscated two vehicles allegedly smuggled into the country in a container.
The officers also questioned 30 foreign workers for allegedly breaching their visa conditions and work permits.
Deputy Chief Immigration Officer, compliance and border division Dino Mas, who invited The National to accompany the officers yesterday, said each government agency was to check to see if the foreign-owned businesses and workers were complying with  PNG laws.

During a debriefing session after yesterday’s inspection, officers exchanged information and discussed what they had discovered.

PNG Customs Officers said they discovered two brand new vehicles, yet to be introduced to the country, hidden in a container.

“These model vehicles have not been introduced yet into PNG. Yet they are already here. We checked the payment documents and discovered that the owner paid only K8000 for each vehicle,” an officer said.
“We will check our overseas counterpart where the vehicle came from, how these vehicles were shipped out of their country.

“We also discovered large quality of undeclared cigarettes in a container in the same premises. These cigarettes were brought in without paying custom taxes.”
Bank of PNG officers, who requested anonymity, said some of these foreign companies had been avoiding paying taxes to the Internal Revenue Commission.

“Some of these companies are making up to K2 million profit annually. But they were declaring around K500 in tax return. So they are avoid paying taxes,” one officer said.
“Seeing their business operations from outside, it is very big. But when they provide business reports, they make it a very small operation.”
The officers said there were many smaller companies but linked to only three or four big companies.

“And they transfer all the money to one parent company and from there, they bank it in an overseas account.
“This is money laundering. We discovered large amount of cash in their premises and discovered that they don’t bank their money in our commercial banks.

“We encourage them to bank the money for security reasons.”
Labour officers requesting anonymity said they discovered that some companies were not paying superannuation for local staff. They also do not pay the minimum K3 an hour rate.
“Some of these foreign employees are doing jobs that locals can do like operating cash registers. But on their work permit they are managers.

“We also found out that there are too many managers for one job. Some of them come on dependent or tourist visas.  But they end up doing business.”
The Labour officers also discovered that some foreign workers were paid in cash so that their employer would avoid paying tax.

K3.1b Pay-Hike Bill Probed

By CLIFFORD FAIPARIK ( The National )

 

AN exercise is being carried out in government departments to find out why the total civil service salary bill swelled by K3.1 billion from K1.4 billion to K4.5 billion in four years.

Public Service Minister Elias Kapavore said a data-cleansing exercise which had begun should identify positions being duplicated.

The exercise involves the Personnel Management Department in consultation with the departments of Treasury and Finance to verify the huge annual increases to the public sector wage bill.

“The primary records show that the public sector wage bill in 2012 was K1.4 billion. This increased to K4.5 billion in 2016,” Kapavore said.

“While we need the increase in manpower to meet services demands, we must be accountable and prudent in controlling costs and achieving efficiencies.”

Kapavore said the data cleansing exercise would include national and provincial administrations “to establish a one-person, one-position, one-pay status for all public servants”.

“We will make it compulsory for all public servants to be registered through the national identification system,” he said.

“All organisations must improve their staff profiling system to put faces to the names of all public servants.”

Kapavore said he was seeking the cooperation of all sectors to support the government initiative “as we strive to improve productivity”.

Earlier, Kapavore said some public servants around the country were yet to be inducted in the public service system.

“That’s why they don’t know their job descriptions,” he said.

“There are many public servants not been inducted on their roles and responsibility.

“Induction programmes are so important. Once someone is recruited, they must be given their job description so that they will know what is required of them. They must also understand the General Orders and Parliament Acts.”

PM APPLAUDS ABEL FOR BUDGET

BY : Post Courier

Prime Minister Peter O’Neill has commended his deputy and Treasurer Charles Abel for successfully handing down the 2017 Supplementary Budget in Parliament yesterday.

“I commend the Treasurer as this is his first budget/money plan. There are now some renewed sense of energy in Treasury and of course as a result of that you can see some real drive into outstanding issues like over expenditure by public servants. The Treasurer is definitely getting things back on track.”

Mr O’Neill said that development is taking place across the country in the areas of infrastructure, health and education. “This is only the beginning and we will make sure we deliver before this term expires,” he said.

“You see, when we came into office in 2012, we built major infrastructure that you see now,” he said.

“If we did not build these infrastructure, the recession will be far worse than today.”

Mr O’Neill said the National Alliance-led government was in control for 15 years and they handed out about seven supplementary budgets when they had surplus, but never built any infrastructure.

“To date, they still can’t name an infrastructure they built, and they left no money in the Trust Account,” he said. “Treasury is the engine room, the heart that controls the body, and you should be very careful.

“It is a fact, that we are all responsible to correct the position when they are course blow outs, to correct it so we set new targets and that is 2.5 per cent of GDP,” Mr O’Neill said.

2017 Supplementary Budget Top Agenda

By : Post Courier

The 2017 Supplementary Budget tops the government agenda when Parliament resumes at 2 o’clock this afternoon.

Deputy Prime Minister, Charles Abel, is expected to hand down the mini budget during this session.

Leader of Government Business, James Marape, could not be reached for comments, but the government has indicated bringing in the Independent Commission Against Corruption Bill (ICAC) to at least test the numbers in this session.

The government is also expected to bring through legislations including the National Energy Authority Bill, for the creation of the similar entity like the Mineral Resource Authority, to aggressively drive LNG projects.

The House will start with Ministers giving their statements and entertain questions without notice.

The tabling of the 2017 Supplementary Budget is point 1 in the 25-point 100-day plan of the O’Neill Government.

Prime Minister Peter O’Neill, said cabinet had decided to support a supplementary budget to maintain the parametres of the 2017 Budget proper.

Mr O’Neill said after a period of sustained high economic growth spurred by the PNG LNG Project construction phase and sustained increases in government spending, circumstances such as the collapse of the price of oil and the El Nino drought, and a slowdown in global growth had dampened economic growth.

He said the mid-year economic fiscal outlook report from Treasury has highlighted these emerging issues with a downturn in government revenues as well as an increase in public service wages, interest costs and rentals, and the rationing of foreign currency.

He said the supplementary budget maintains a 2.5 percent budget deficit and 32 percent debt to GDP ratio in the 2017 Budget proper by deferral in the Service Improvement Program and cuts to the capital and recurrent budgets.

“The SIPs (DSIP/PSIP) are a very important pillar to our government, however, the cabinet has recognised the need for discipline during tough times. The deferral to SIPs will be replaced in subsequent budgets,” Mr O’Neill said.

He said the Supplementary Budget will also boost medicine procurement, coffee berry borer response and more funds to the Department of Works.

He said a range of other measures are also brought to support and give direction around the 100-day, 25-point plan.

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