SOEs owe IRC K700mil in taxes

By SHIRLEY MAULUDU
STATE-OWNED enterprises (SOE) owe Internal Revenue Commission (IRC) about K700 million in taxes, according to the Internal Revenue Commission (IRC).
Commissioner general Sam Koim told a media conference in Port Moresby yesterday during a presentation by PNG Ports Ltd of a payment of more than K26 million in taxes.
“A lot of our SOEs are really struggling,” he said.
“We have about K700 million in our tax debts that are owed by the SOEs alone.
“Just under K700 million.
“That’s a significant amount of tax that the SOEs owe to the Government.
“PNG Ports fortunately is not part of that,” Koim said.
Koim said he had raised the issue with Public Enterprise and State Investment Minister William Duma and Kumul Consolidate Holdings managing director Isikeli Taureka when he met both men this week.
“That’s a significant debt owed by the SOEs led by PNG Power (Ltd).
“PNG Power reportedly said the Government owes them K400 million.
“And they also owe the Government K400 million.”
Koim said IRC had proposed ideas to have these debts resolved.
“The proposal we’ve put before the Government is to have a debt swap arrangement to clean off some of the debt.
“That has not been done before but it’s done elsewhere in some tax jurisdictions.
“We are just looking for an offset arrangement so that we can clean up some of those debts and then the companies can clear up their debts, go to the market and also borrow and operate commercially,” he said.
He said another option available was to transfer the debt to the directors.
“There’s a law that is available to shift the tax liability onto the directors to pay.”
“We haven’t exercised that power. If you want to be a director of an SOE, make sure you run the SOEs in a way that ensures they pay their taxes as well as their liabilities.”