Chamber supports scheme

 THE PNG Chamber of Mines and Petroleum have disagreed with a suggestion by the tax review committee to replace the current tax credit scheme, an official says.

Executive director Greg Anderson said the suggestion by the committee through issues paper was not the right step forward. “The taxation review issues paper is also putting infrastructure tax credits, or tax credit scheme, in spotlight by suggesting it could be replaced by a 150% tax deduction scheme rather than the present system of reducing the tax payable by expenditure incurred by company,” Anderson said.

“The industry strongly believes this would be a retrograde step as eligible resource projects would stop using TCS as it would add to cost of company operations.

He said the issues paper drew a parallel between TCS (tax review scheme) spending by resource projects and “the treatment of donations to registered charities by individuals”.

“This is not a valid comparison because the schools, aid posts, hospitals, roads and other capital assets constructed under the TCS provide essential public services that are generally lacking or inadequate in most remote locations.”

He said the 10-year tax holiday granted to the Ramu Nickel project by the government was projected to move to full production this year without paying any income tax.