Tax credit scheme

By Ivamere Nataro 25 August 2019, 2:00PM

Some $118 million in tax credits are owed to the Government since its tourism tax credit scheme was brought into force in 2003, according to the Minister for Customs and Revenue.

Under the scheme hoteliers who invest at least $100,000 in an approved tourism development are given a credit against future taxation if the investment is held for five years.

The scheme was abolished at the end of last year.

Tialavea Tionisio Hunt said hoteliers who invested before that time were given five years to utilise their investments.

“Some [hoteliers] already invested before we closed [the tax credit scheme] last year in June, so I don’t know what the amount they have to use in the next five years and they have to use that until 2023. 

“After the five years, and if [hoteliers] don’t, they will forfeit the investment,” Tialavea said. 

“[Government may] lose on this side but we gain on the other hand when we collect revenue from [hoteliers] through taxes, their workers through their N.P.F. and A.C.C.

“Then after five years, the money will still come in, and then it [tax credit balance] would pay itself later on.” 

Tialavea said some locals are multiple investors in other hotels and are utilising the credit they still owe Government. 

“[Local hoteliers] invested in Lefaga, Aggie’s, Taumeasina and other different hotels.”

The Tax Credit Scheme was enforced in 2003 under the Income Tax Amendment Act, which allowed hoteliers not to pay taxes but invest in other hotel developments.

However, on December 1, 2017, Government approved that hoteliers endorsed under the scheme are to pay taxes. 

Prime Minister Tuilaepa Sailele Malielegaoi says this has been going on for far too long. 

“Even to those hoteliers who received assistance through this scheme and after many years, we are still waiting for the new hotels, but so far nothing,” Tuilaepa said at the time. 

By Ivamere Nataro 25 August 2019, 2:00PM
Samoa Observer

Upgrade to Premium

Subscribe to
Samoa Observer Online

Enjoy unlimited access to all our articles on any device + free trial to e-Edition. You can cancel anytime.

>