Firm: Agriculture needs tax exemption

Business, Normal
Source:

The National, Friday February 12th, 2016

 By Gedion Timothy Lapan 

IT is unfair that there is no tax exemption for businesses in agriculture compared to those in the extractive sector, an official says.

Ilan Weiss, the chairman and director of the Israeli company Innovate Ago Industry Ltd, mentioned this during an agriculture summit in Port Moresby yesterday.

As an example, he mentioned the K23 million potato project in Surinki, Enga, where he estimated that Goods and Services Tax plus Customs duties would be K5 million – even if the company is yet to receive any return from the project.    

“(This is) asking the investor to pay K5 million just for the Goods and Services Tax, and Customs, when this investor has not made a single toea yet, has not set up the farm, even before revenue,” he said.

He told the participants including Agriculture Minister Tommy Tomscoll that K5m was unattainable, “the investor will go away”. “And for the resource sector under legislation, totally exempted and I do not see any reason why that there should be any bias toward agriculture,” he said.

“If you look at Fiji, it exempted all agricultural projects from GST and Customs and gave a tax holiday to all agriculture investors for 13 years,” he said. 

“This is what our neighbours are doing.”

He said withholding tax was also one of the burdens agriculture investors faced.

“The resource sector, whatever the size of the project, whatever they are doing is exempted automatically by policy,” he said.

“They do not have to beg for it. I do not have to go and ask the secretary or others leaders to convince them that I should have to get the exemption.” 

He said Tomscoll was reportedly driving legislation which would ease the constraints, “real constraints on attracting real investors into the agriculture sector in Papua New Guinea”.

 

 

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