VAT to rise by 5% next year

National, Normal

The National

THE tax we pay on goods and services (VAT) should be raised from 10% to 15%, the additional 5% going towards paying school fees for all children in the country starting next year.
This is being proposed by Sumkar Open MP Ken Fairweather, a member of the People’s National Congress party that is a coalition partner in the Somare Government.
Mr Fairweather said paying schools fees was reducing a significant portion of the population to begging, stealing and prostitution.
It was also driving many people into the grip of loan sharks, and even the old are being forced to contribute to the burden, he said.
“The whole structure of community living and giving is being paralysed by this burden. Because schools fees are compulsory, and are imposed without any regard to the capacity of parents to pay, our literacy levels are stuck in the 60% area.
“This is where it has been for years,” the MP  argued.
He said research had shown that school fees could be abolished by increasing the goods and services tax (VAT) to 15%.
Increasing the VAT will mean everyone – including politicians, the well off, business people, tourists, foreign workers, and everyone else – contribute towards school fees, and the more they buy, the more they contribute, he said.
He said the effect of raising the tax (VAT) from 10% to 15%  was  not significant.
The effect of 15% tax (VAT) means an extra 15 toea on a one kg of rice, and K4,000 on a K80,000 car.
“If anyone can afford K80,000 they can afford the extra tax (VAT) as a contribution to the education of the nation’s children,” he said.