The Minister of Revenue, Tialavea Tionisio Hunt, has disputed the claim by Virgin Australia that the government owes $9.2 million tala in jet fuel excise rebates.
“We only owe them $1.8million tala, not $9million,” he told the Sunday Samoan.
“And we have formally informed them through a correspondence indicating the amount of $1.8million.”
Tialavea made the admission in response to questions from the Sunday Samoan.
Earlier this month, Virgin Australia asked that the government pay US$4.02million (T$9.2m) in outstanding jet fuel excise rebates. The demand was made in a letter to Prime Minister Tuilaepa obtained by the Sunday Samoan. Dated 29 May 2017, the letter is written by John Borghetti, the Chief Executive Officer of Virgin Australia.
“I would like to bring to your attention that Virgin Australia intends to continue to pursue the US$4m in jet fuel excise rebates, which is currently owed by the Samoan Government to the VSAM JV,” Mr. Borghetti writes.
“I understand that the Special Negotiating Team is aware of this issue. Virgin Australia has been actively pursuing the repayment of these monies since April 2015, as noted in the attached letter to the Ministry of Revenue.”
However according to the Minister of Revenue, the jet fuel excise rebates should be claimed within 12 month each year but that was not the case with Virgin Australia.
“That is our policy on the fuel excise rebates. They did not claim the rebates from the previous years. And that is not our problem.”
Tialavea told the Sunday Samoan that the government should only be paying for the rebates for the year 2015.
The Minister referred to comments from Prime Minister Tuilaepa comparing the status of the joint venture a marriage divorce.
Tuilaepa said that “nothing is ever perfect.”
He said that in every investment the “government weighs the pros and cons to ensure maximum benefits for the country and our residents."
The decision to enter and withdraw from a joint venture with Virgin Australia is one of them.
“Simply put, it’s like divorce proceedings between a couple."
“Before the divorce papers are signed the couple meets to negotiate how their assets and finances are equally and fairly divided between the spouses."
“That is the same process that our officials and Virgin Australia are engaging in.”
Along those lines, the Prime Minister recalled that at one point in the ten-year marriage, Virgin Australia requested financial injection from the government of Samoa to assist with the joint venture.
“And due to the confidentially of the on-going negotiations with Virgin Australia, I am not at liberty to divulge details of how much money was involved but rest assured government granted Virgin Australia’s request for funds at the time without hesitation.”