THE Ministry of Finance and Treasury plans to implement cost-cutting measures to increase revenue and meet the country’s service needs within the Government’s 100-day program.
This decision follows significant revenue losses due to exemptions, mismanagement and corruption.
The Minister of Finance and Treasury, Manasseh Sogavare announced this when contributing to the sine die motion moved by Prime Minister Jeremiah Manele in Parliament on Monday.
Sogavare, a four-time prime minister and the country’s longest serving Parliamentarian, highlighted that from January to April this year, the government had forgone a total of $83.6 million in exemptions from Inland Revenue and Customs.
He said this includes $9.3 million in statutory exemptions, over which he has no power as minister.
Additionally, Minister Sogavare said there were $74.2 million in discretionary exemptions, including $8.4 million attributed to Members of Parliament through Constituency Development Fund (CDF) purchases.
Minister Sogavare warned that if this trend continues, the government expects to forgo $222.6 million or more by the end of 2024.
“That’s the kind of revenue we lost, but we really need it,” he said.
Minister Sogavare emphasized that the government would review discretionary exemptions and stop granting exemptions to individual companies.
Instead, applications will be evaluated on a case-by-case basis, he added.
Furthermore, Sogavare criticized the Ministry of Forestry and Research (MoFR)for failing to address unaccounted revenue in the forestry sector.
“Loggers are laughing to the bank while our economy suffers from unaccounted revenue,” he said.
He urged the MoFR Minister to take immediate action to address these discrepancies and ensure proper tracking and accountability.
Minister Sogavare also announced that vehicle owners will be taxed $50 each year as part of a newly introduced ‘pollution fee.’
This fee is part of new measures the government is taking to increase revenue and tighten the tax system.
“If you do something that attracts this tax, you will pay. It will start with vehicles and then include ocean-going vessels and other engines,” he said.
Minister Sogavare said he expects this new tax policy to generate around $2 million, which will go towards the Ministry of Environment, Climate Change, Disaster Management and Meteorology (MECDM) to help them manage pollution.
By EDDIE OSIFELO
Solomon Star, Honiara
