Internal Revenue Commission (IRC)

He said the Government did not have everyday control over IRC’s work IRC had made assessments and had been in conflict with Barrick over their assessment criteria.

“Barrick has asked some fundamental questions, especially on the IRC’s definition of ‘taxable stripping’, in as far as resource harvest is concerned,” Marape said.

“Barrick is of the view that the current ‘taxable stripping’ definition is not consistent with practice and law, hence the prolonged dispute, so we had to intervene.

Leader of the Opposition, Hon. Joseph Lelang, made this comment in response to the National Executive Council (NEC) appointment of a panel of three independent experts to review a tax dispute between the Internal Revenue Commission (IRC) and Barrick Niugini Ltd (BNL).

Lelang said if there was a dispute between the IRC and Barrick, there are appropriate forums under the law for dispute resolutions.

This new panel of experts, he said is a waste of resources and time and has no legal standing at all to resolve any dispute.

NEC noted the progress of the activities required to reopen the Porgera Gold Mine and was concerned that the tax matter was prolonged.

While it continues to observe the independence of the internal revenue commission, it availed itself of the opportunity to be advised independently of the issues surrounding the taxation dispute.

In the recent 2023 Budget sitting, this tax-free threshold has further been increased to K20,000 per annum.

Treasurer, Ian Ling-Stuckey, has announced that this change is only for a 12-month period and is scheduled to end on 31 December 2023.

“The Government has yet to indicate whether this threshold will be maintained or revert back given it is still being labelled as a temporary relief measure,” states Sam Koim, Commissioner General for the Internal Revenue Commission (IRC).

Commissioner General Sam Koim made the announcement on Thursday 22 December 2022. 

He said, “We have been profiling these two companies (names withheld for confidentiality reasons) for over a year. The letters formally notifying them of the audit were signed and served today.

Goods and Services Tax (GST) is a tax on the consumption of goods and services and is charged at 10 percent of the sale price.

IRC states, “Any business with an annual turnover of K250,000 is required to register a GST account under their Tax Identification Number (TIN) with IRC and charge GST. That business is also expected to pay and file on time.

“Any business with a turnover of less than K250,000 can charge GST so long as they open a GST Account with the IRC.”

The Audit revealed that this flourishing retail taxpayer declared around K53 million in GST credits for the periods January 2015 to April 2020. In other words, the taxpayer was telling the IRC that the company was paying more than what it was collecting in GST for each and all of those six years.

IRC Commissioner General Sam Koim said, “We (IRC) are on target. There are only two times where IRC hit the K8 billion mark. One was in 2014, another one was in 2018. And those were the good times, but this is the most difficult time that we are hitting K8.1 billion and it would be probably more than that by the end of the week.”

Mr Koim said IRC meeting the 2021 target is due to effective collection strategies adopted by the Commission.

About K1,221,234.90 was withheld by the Provincial Government from service providers and companies this year as GST. 

This comes after the New Ireland Provincial Government signed a Memorandum of Understanding with the Internal Revenue Commission in 2018, following a Provincial Executive Council decision to increase revenue internally as we move towards financial Autonomy.

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 22^nd of every month.