PNG's Oro Governor Juffa calls for Restructure in Tax Regime
By: Josu Kim/FM100/PNGToday
Northern Province Governor Garry Juffa has proposed to the new government to restructure the tax regime in the country because it is not benefitting Papua New Guineans.
Speaking on FM100 radio TalkBack Show this morning, Mr Juffa said there are frustrations everywhere on the cost of just surviving.
"Ordinary Papua New Guineans do not have savings, they are not just living on paycheck to paycheck but they are also living on booking money (debt), debt upon debt, they're hardly out of debt when they have another issue that they have to deal with and they're back in debt again, everyone's drowning in a sea of debt," said Mr Juffa.
"This tax regime is not PNG friendly, it is PNG hostile."
Mr Juffa said the personal income tax of 35 percent Papua New Guineans pay is too high compared to most parts of the region where 10 to 15 percent is the personal income tax.
"In Papua New Guinea, you're paying 35 percent on your income, then you got to pay taxes again on your resignation, retirement, retrenchment and so forth and it is quite high."
Mr Juffa at the same time suggested to the government some ways to deal with the issue.
"First and foremost, do away with retirement, retrenchment and resignation tax, you are not going to suffer a huge tax blow to your tax revenues if you do that, but you will definitely help ease the tax burden on Papua New Guineans."
"Then you cut down the tax regime from 35 percent to a more reasonable rate of 25 percent."
He said for the question of how the government is going to get revenue is that it has to be creative, innovative and assertive in collecting tax.
"That's not happening, right now what is happening is the tax office waits for people to turn up and pay their taxes and then they punish them."
Mr Juffa further went on to state some of the foreign investors who are operating in PNG in mineral resource, forest and fisheries sectors who hardly pay taxes and stated that PNG has to learn from Australia and Fiji on how serious they are when it comes to taxes.
"The Australian Government for example has about 30 000 people in the Australian army and about 36 000 people working in the tax office, that is a country that is serious about its taxes and they've got a network that keeps complete oversight of all movements of funds in their economy in and out."
"We could also learn a lot from Fiji, the Fiji Inland Revenue and Customs Authority (FIRCA) is ruthless when it comes to collecting taxes from foreign investors, they make sure you pay. They're not going to be aggressive and be assertive in a way that they chase out investments but they're going to be firm on their standings," said Juffa.
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Northern Province Governor Garry Juffa has proposed to the new government to restructure the tax regime in the country because it is not benefitting Papua New Guineans.
Speaking on FM100 radio TalkBack Show this morning, Mr Juffa said there are frustrations everywhere on the cost of just surviving.
"This tax regime is not PNG friendly, it is PNG hostile."
Mr Juffa said the personal income tax of 35 percent Papua New Guineans pay is too high compared to most parts of the region where 10 to 15 percent is the personal income tax.
"In Papua New Guinea, you're paying 35 percent on your income, then you got to pay taxes again on your resignation, retirement, retrenchment and so forth and it is quite high."
Mr Juffa at the same time suggested to the government some ways to deal with the issue.
"First and foremost, do away with retirement, retrenchment and resignation tax, you are not going to suffer a huge tax blow to your tax revenues if you do that, but you will definitely help ease the tax burden on Papua New Guineans."
"Then you cut down the tax regime from 35 percent to a more reasonable rate of 25 percent."
He said for the question of how the government is going to get revenue is that it has to be creative, innovative and assertive in collecting tax.
"That's not happening, right now what is happening is the tax office waits for people to turn up and pay their taxes and then they punish them."
Mr Juffa further went on to state some of the foreign investors who are operating in PNG in mineral resource, forest and fisheries sectors who hardly pay taxes and stated that PNG has to learn from Australia and Fiji on how serious they are when it comes to taxes.
"The Australian Government for example has about 30 000 people in the Australian army and about 36 000 people working in the tax office, that is a country that is serious about its taxes and they've got a network that keeps complete oversight of all movements of funds in their economy in and out."
"We could also learn a lot from Fiji, the Fiji Inland Revenue and Customs Authority (FIRCA) is ruthless when it comes to collecting taxes from foreign investors, they make sure you pay. They're not going to be aggressive and be assertive in a way that they chase out investments but they're going to be firm on their standings," said Juffa.
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