It is hoped that the renewal of the memorandum of understanding between the Internal Revenue Commission (IRC) and the Investment Promotion Authority (IPA) will reduce it.
The MOU signed between the two agencies on the 14th of May allows for an efficient, streamlined process.
IRC Commissioner General, Sam Koim, said this partnership, which was first signed in 2013, allows ease of access for citizens and clients.
“Coming from an anti-corruption background, a lot of corruption at the bureaucratic and low level corruption is caused by the process itself,” Koim stated. “When we put a very cumbersome process for our users to comply and people start paying people to shortcut the process…so the process itself produces corruption in a way.
“The partnership that we are reaching and also having a counter at IPA that offers that kind of painless process where they register a company and they also register for taxpayer identification number (TIN), this will prevent a lot of opportunities for bureaucratic corruption as well.”
The MOU allows for both parties to conduct joint programs in line with their respective statutory mandates, for the purposes of awareness on each of their roles and functions, compliance and facilitating and monitoring the business activities of national, citizen and foreign individuals and enterprises throughout PNG.
Koim highlighted that the partnership will enable information sharing, which is vital for IRC as entities and taxpayers are capitalising on the information gap and misleading the Commission.
“We have very rich data that is being housed at IPA, at Customs, at Lands Department, at the municipal services and authorities but just because we have an information gap, we don’t have the opportunity to know the taxpayers enough.
“So our strategy at IRC here going forward is to start to reduce the gap. We would like to get to know our taxpayers, the directors, the relationships they have, their common addresses, the extended relationships and partnerships.”
Koim said having access to the transactional behaviour of taxpayers means they will be able to determine whether a business is making a loss or not, considering the fact that certain entities have been consistently declaring losses.
(IRC Commissioner General, Sam Koim, signing the MOU with IPA managing director, Clarence Hoot)