Oil Search : K3.54 billion in taxes paid to PNG Government
FROM 2013 to 2018, Oil Search Ltd (OSL) has paid US$988.36 million (K3.54 billion) in actual taxes and prepayment of taxes (via state approved tax credit schemes) to the country, according to a company statement released this week.
This included US$295.12 million (K1.002bil) in petroleum taxies, ie income tax and additional profits tax; US$266.30 million (K904.2mil) in tax credit scheme expenditure; US$189.52 million (K643.53mil) in salary and wages taxes; US$103.66 million (K351.99mil) in royalties and development levies; US$133.76 million (K454.19mil) in other government taxes, ie withholding taxes, excise, stamp duty and GST (goods and services tax).
OSL made the statement in response to Prime Minister James Marape’s call for the company to pay its fair share of taxes due to the government and people during an occasion last week to mark the 90th anniversary of the company’s operations in PNG.
Marape congratulated Oil Search on its 90-year milestone and spoke of his vision for country and his prime ministership and reaffirmed his commitment to improving the national economy and the lives of all the people and at the same time allowing businesses to flourish in PNG.
OSL said it fully supported Marape’s call for all companies operating in PNG to pay their fair share of tax.
Oil Search also supported Marape’s statement regarding the need for improved efficiency in collecting taxes;
Oil Search had long supported revenue transparency. For example, Oil Search’s 2018 Transparency Report (available online) brought together information on all payments made to Government and socio-economic contributions and described the company’s approach to tax transparency;
Oil Search’s principle-based tax management approach aligned with the company’s core values of acting with integrity, acting responsibly and respecting communities, partners and governments.
It also supported the company’s efforts to provide information to governments and their agencies so they could review tax policy and enhance their tax systems’ equity, effectiveness, efficiency and administration;
Oil Search maintained a transparent and constructive dialogue with government and tax authorities regarding its tax approach and disclosures;
Oil Search paid taxes in full compliance with the letter and intent of the laws that governed its operations.
The company complied with all statutory obligations and disclosure requirements on a full and timely basis;
and,Oil Search was focused on building the capacity of government instrumentalities to enable them to progressively take on full responsibilities, in a sustainable manner.
For example, through the support of the provincial health authorities in Hela, Southern Highlands and Gulf.
In 2018, OSL contributed US$451 million (K1.5 billion) towards socio-economic development in the country, including US$248 million (K818 million) to PNG-owned suppliers and contractors; US$115 million (K380mil) to the government; US$21 million (K69mil) in wages and benefits to PNG-based employees; US$66 million (K218mil) in community investment; US$1 million (K3mil) in dividends to its PNG shareholders.
From 2013–2018, OSL spent US$91 million (K309 million) delivering community development programmes, including those focused on power generation, education, health and business development; donated US$59 million (K200mil) to the Oil Search Foundation to support the government in delivering and strengthening services in the areas of health, women’s protection and empowerment, education and hygiene; spent US$5 million (K16mil) in partnerships with third-party community-based organisations to assist in the delivery of community initiatives; spent US$380 million (K1.2bil) for the supply of goods and services delivered by local landowner companies; spent US$266 million (K903mil) on Infrastructure Tax Credit Scheme projects on behalf of the government, including Apec Haus, National Football Stadium, Manasupe Haus, phase 1 of the Erave to Samberigi road, stage 1 of Kupiano Hospital, including an administration building and outpatients’ ward, upgrades to Bimai High School, including a double classroom, two dormitories and two teachers’ houses.