Project to generate funds for provinces through GST

THE Internal Revenue Commission (IRC) will be de-grouping businesses who file goods and services tax (GST) from the headquarters in Port Moresby to ensure GST is collected at the point of sale.
Commissioner general Sam Koim said on Friday that IRC was undertaking a project to identify where businesses were operating and where the money was coming from.
“So whatever the 60 per cent is attributed to that point of sale, we can give that (60 per cent) back to the province that helped to generate that money,” he said.
“We have businesses that have branches around the country as well but when they file their GST, they only file out of NCD and that’s where sometimes GST is attributed to the headquarters instead of where it’s collected.”
Koim explained that there was a form line that the businesses were supposed to comply to.
However, the challenge was that sometimes that form was filled and sometimes, it was not attributed.
“So what we are doing is undertaking a taxpayer mapping exercise that will also help us with the de-grouping exercise to try to identify which business is operating where, under what TIN number and doing what business,” Koim said.
“In that way, we will be able to help.
“For instance, Ela Motors has branches all over the country.
“The sales made out of Wewak will be attributed to the East Sepik government.
“That’s the exercise,” Koim said.
“But we’ve started this project and we will be continuing this year hoping to complete this year.
“That will go a long way in helping also in providing incentive to the provincial governments.
“We’ve received a lot complaints from the provincial governments that are genuine so we’ve taken that on board and undertaking that exercise.”
Gulf Governor Chris Haiveta welcomed the announcement that IRC would be undertaking the de-grouping exercise.
“I welcome that as a province who has lost in terms of getting GST and other revenues in taxes that are collected here,” he said.