Tax regime attracts 1,000

MORE than 1,000 individuals in the country have so far registered to participate in the recently introduced small business tax regime (SBT) by the Internal Revenue Commission (IRC).
Commissioner-general Sam Koim said interests were mostly from sole traders.
“The SBT regime is a significant reform introduced by the Marape Government to reduce the compliance burden of all those operating in the small to medium enterprise (SME) and medium small to medium enterprise (MSME) space whose annual turnover is below K250,000,” he said.
“So far, we have had 1,565 individuals registered to participate in this regime, of which 245 are females. “The SBT regime has been greatly appreciated by sole traders for its simplicity and very low tax rates and enabled us to bring into the formal tax net those businesses that would otherwise not be taxed on their earnings.”
Koim said IRC believed that there was a significant tax gap – the distance between what we were collecting and what we were supposed to collect.
“Any attempt to reduce the tax without reducing the tax gap will result in significant revenue sacrifice for the Government and, hence, would affect the budget,” he said.
“Our current strategy is to reduce that gap by undertaking various initiatives, including effective collection interventions.”
Meanwhile, Koim also said IRC had improved the terms and conditions of staff to retain skilled staff and become a competitive employer of choice.
“Improving staff terms and conditions is a disincentive to corruption, hence protecting government revenue,” he said.
“IRC’s staff home ownership subsidy scheme is one of the few in the public sector organisations.
“As of this date, 25 staff have their own homes under this scheme.
“Whilst improving on terms and conditions of staff, IRC uses a ‘carrot’ and a ‘stick’ approach to reward performance and instill discipline.
“As a high-risk organisation, IRC takes staff disciplinary issues seriously.
“In the last six months, two staff were dismissed for absenteeism, and a few others resigned.
“We have also installed a computer monitoring system that tracks staff onscreen activities and measures performance in a stealth mode according to set rules.
“This also provides management with timely reports on staff productivity.”
“We have recently suspended 16 staff without pay on the grounds of corruption whilst their disciplinary files are being finalised,” he said.