The Commissioner General of the Internal Revenue Commission (IRC), Sam Koim, has urged provincial governments to use wisely the Goods and Services Tax (GST) funds given by the IRC.
He said this in response to an article published in The National newspaper on October 5 titled “City allocates over K14 million from tax to maintain roads.”
In a statement, Mr Koim said 60 percent of all the GST that is collected from the provinces is given back to them, to support their provincial budgets and IRC does the distribution 22nd of every month.
He said this is reliable and untied cash that is given to each province. Mr Koim said the GST is collected from the business activities in each province. Therefore, as part of the social contract, businesses that facilitate and pay the GST revenue expect the government to create a conducive business environment for doing business.
“Businesses cannot be expected to provide their own roads, address security issues or maintain street lights. They pay their taxes for the Government too and in return, provide these services.”
Mr Koim said: “More often than not, we find provincial governments get the tax money and forget the businesses that paid them that money. We have received so many complaints from our taxpayers.
“I am therefore urging the provincial governments to use a good portion of the GST funds to improve the services in the towns and cities that produce the GST.”
“The Lae City Authority is a success story, where with the blessing of Governor Ginson Saonu, 20 percent of the Morobe Provincial Government’s GST portion is given to LCA to improve services in Lae City. LCA, under the leadership of Mr Rosso, is putting the money to good use,” he added.