Dept, IRC set up new measure to collect tax from Govt agencies

By PETER ESILA
THE Department of Finance and the Internal Revenue Commission (IRC) have launched a new measure to ensure improved compliance during the remittance of goods and services tax (GST) from supplies of State agencies to the IRC.
Finance Minister Sir John Pundari, during the launch in Port Moresby yesterday, said this would support the collection of Government revenue.
The Finance Department, with the IRC, will actively support the rollout of the GST Sec.65A initiative in the information financial management system (IFMS).
IRC commissioner-general Sam Koim said the trialing and manual process with 15 agencies for less than six months had resulted in over K20.8 million in the collections so far. Sir John said while some Government contractors honestly declared and paid their taxes on time, there were others who refused or were too lazy to pay the State the taxes they owed.
“I believe the automation and roll out of same to other government departments in the IFMS will boost the revenue collections,” he said.
“As the Covid-19-induced economic contraction continues to have a grip on our economy, we in Government have to explore ways to make sure that the little cash we have continues to circulate.
“Whatever we pay the private sector to procure goods and finds must find its way back to the main coffers in taxes.
“Section 65A project is aimed at establishing an effective point of collecting what is due for the State in taxes.
“I am also encouraged to officiate at a project that moves away from labourious and inefficient methods of tax collection and advance in financial technology.
“This arrangement will substantially reduce administrative burdens, not only on the IRC
but also the Government departments that are served with the notice to withhold the GST component.”