The Internal Revenue Commission (IRC) has begun audits and reviews into companies engaged by State Agencies as contractors using COVID-19 funds.
IRC Commissioner General, Sam Koim, said this is part of the Tax Crimes Prosecution initiative that they are undertaking this year.
Koim said companies who recently made headlines after receiving contracts under COVID-19 Funding are also being looked into.
Koim said the tax office continues to make it its business to collect revenue for the Government from hard hit tax payers, and spending agencies must spend it responsibly in productive areas.
He said as part of the Tax Crime Prosecution initiative, scheduled to begin in early April but deferred due to COVID-19 shut down measures, companies given public funds will be looked into. These include contractors engaged using COVID-19 funds.
Koim said it is already apparent that some of the contractors are not tax compliant.
“One or two entities that have hit the limelight in terms of getting contracts using COVID-19 money, we are auditing them, looking into them.
“One of those controversial companies has never filed, has never paid a single toea, but got a contract using COVID-19 money. So we will be taking actions on those companies who are getting money,” said Koim.
He added “We all are struggling, businesses are all struggling to keep the government coffers in liquid, and these spending agencies must make sure that only tax compliant entities that are honestly doing business are given business.
“So we will be prosecuting some of them, and we will be getting hard on those entities that have hardly paid a single toea to the Government coffers, but yet continue to get business from Government.”
In late March the revelation of a local catering company receiving K539, 000 for services rendered at the Rita Flynn Isolation Unit in NCD between May and November 2020, made headlines.
The company, Caring Limited, also has a Director whose is a senior official within the Department of Health.
Prime Minister, James Marape, Health Minister, Jelta Wong, and National Pandemic Controller and Police Commander, David Manning, have all called for an investigation into contract.
Meanwhile Koim has urged State Departments and agencies to award contracts to regulatory and tax compliant businesses and companies.
“So that’s a warning to all the spending agencies to make sure that, the money that my staff are risking to make here, the money that small businesses are continuing to pay taxes faithfully, must be used in productive areas and must not be wasted. Secondly contracts must be given to tax compliant entities and that’s the thinking that this Government is strongly advocating and we stand to implement that thinking of the Government of the day,” said Koim.