Commission asks court to restrain tax

THE National Capital District Commission (NCDC) has asked the court to restrain the Internal Revenue Commission (IRC) from distributing to Central, Gulf and Motu Koitabu Assembly (MKA) the goods and services tax (GST) component which goes to NCDC.
Under the amended National Capital District Commissions Act 2001, IRC commissioner general Sam Koim sliced the 60 per cent of GST share paid to NCDC, giving 10 per cent to the Central government, three per cent to Gulf government and two per cent to MKA.
Aggrieved by the decision, NCDC (applicant) on Thursday, filed an urgent application in the Waigani National Court seeking to stop the payments of GST shares while it challenges the validity of the IRC commissioner general’s decision in court.
Justice Thomas Anis will make a ruling this week whether to restrain payments of the GST shares.
Lawyer Mal Varitimos, of Ashurst Lawyers representing NCDC, told the court that by statute (law), NCDC was entitled to 60 per cent appropriated from the GST collected in NCD, so the question is whether there should be a reduction from that 60 per cent which is contrary to what has been happening.
He said section 40 of the Inter-Governmental Relations Act which governs GST distribution to provincial governments, provided that NCDC was entitled to receive 60 per cent of GST collected in NCD.
Varitimos said under Section 37 of the Act, all revenues collected through the imposition of the GST be paid into the NCD GST trust account established by statute.
Varitimos further submitted that while Section 33 (1) of National Capital District Commission Act 2001, stated that the commission “shall provide financial assistance” of the prescribed amounts – 10 per cent, 2 per cent and 3 per cent – it did not specify whether it was to come from the statutory trust account.