Govt: Increased Export Tax On Logs To Fetch K450m
The government is expected to generate between K400 and K450 million in revenue annually from the forest sector when it imposes the new round log tax export levy at 59 per cent- an increase from 32.5 per cent.
Though the Forestry Industry Association, comprising 24 members, and the Opposition Leader Belden Namah have raised concerns that this could commercially affect and kill the forestry industry, Minister Solan Mirisim and the National Forest Authority Managing Director Tunou Sabuin have jointly brushed this aside and affirming the forestry business would survive.
Mr Sabuin said many companies in the past have said they would move out because of changes in policies but they have not. In the statement by the industry and the opposition leader described the tax increase as “massive, unjustified, unfair and discriminatory”.
“The government assumes of course that the industry will continue on unaffected by the new and unsustainable tax rate.
This assumption defies economic and commercial reality,” the PNGFIA said in a published statement. One of the members of the association and a big player in the forest business is the RH Group.
“Our view and our position it’s a good tax regime,” Mr Mirisim affirmed in a press conference.
“It’s too early for us to review it when we haven’t implemented it.”
Managing director Tunou Sabuin said the industry has argued that they were not consulted and he admitted his organisation as the regulator was not consulted but he was forthright that for quite some time, the industry benefited a lot in the past and this time the government and landowners should reap some benefits.
Imposing the new tax rate would help government make an additional revenue of about K200 million a year. He said for companies that complain: “The door is open they can go. “We don’t want to work with companies that complain.”
Mr Mirisim said landowners should report any company that uses the tax increase to shut down and leave our shores.
He said some companies may be bankrupt or have moved money out of the country through dubious means or because of landowner issues they decide to leave, using the tax increase as an excuse.
“Once that happens, report to the office,” Mr Mirisim said.
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