Govt to phase out tax holidays

By HELEN TARAWA
PNG is becoming a more attractive investment destination and the government will soon be phasing out tax holidays, deputy prime minister and treasurer Charles Abel says.
Abel said the government selectively negotiated provisions and agreements with certain companies because of special circumstances – it could be a new industry, it might be an area where people don’t want to invest.
“Tax holidays are only used selectively and occasionally.
“They should not be overused and I think in most of our industries now, the time has come where the requirement for tax holiday is no longer so applicable anymore.
“PNG is becoming a more attractive investment destination. We don’t need to give too many concessions out.
“Companies need to come in and invest in PNG and be prepared to pay their fair share,” Abel said.
He explained that the government used tax holidays in the past, particularly when the economy was going through a tough time and the country needed foreign capital.
We wanted to attract people to come in and begin the investment into petroleum or gas industry or into certain special agriculture projects but that is becoming a more of the thing of the past.
“We are trying through Treasury to say ‘ok, we phase out tax holidays now’.
“There’s no need for that sort of incentives any more.
“Some of the old agreements have certain provisions around tax holiday, but that’s become a thing of the past,” Abel said.