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Value added G.S.T. won't increase, P.M. says

Prime Minister, Tuilaepa Dr. Sa'ilele Malielegaoi, has dismissed claims the Government is looking at increasing the Value Added Goods and Services Tax (V.A.G.S.T.).

Speaking during his weekly programme on TV3 on Wednesday, Tuilaepa said they had no intention of raising the tax which currently stands at 15 per cent.

“That is the sole responsibility of the Ministry of Finance and Ministry of Customs and Revenue, when it comes to taxes but if there should be an increase, justification is required. We cannot just increase it,” he said. 

Looking back at the history of the V.A.G.S.T., the Prime Minister said the Government moved to implement it in the 1990s. 

“This led to the opposition to strike against the [V.A.G.S.T.] for five years from 1994 to 1999. However [then Prime Minister] Tofilau [Eti Alesana] who stood his ground and that’s what a good leader does, a bold leader that stood his ground when it comes to decisions that will benefit the country as a whole,” he added.

He added that at the time there were a number of complaints against the V.A.G.S.T. but nothing happened, though the revenue collected from the tax has assisted various development projects. 

For the 2018-2019 financial year, a total of $150.3 million in revenue was collected in the March quarter of 2018-2019 with the V.A.G.S.T. comprising $133.0 million of that total amount. The figures were recorded in the Samoa Bureau of Statistics Financial Statistics Overview report for March 2019.

However, revenue dropped in the December and March quarters seeing only $36.9 million and $13.1 million recorded respectively, the report stated. 

“There were no grants recorded during the period under review and as a result, total revenue during the quarter decreased by $13.1 million compared to its corresponding quarter in 2018,” the report states. 

“Tax revenue stood at $133.0 million in the period, an increase of $16.6 million compared to March quarter 2018 and declined by 18.8 million compared to the December quarter.”

Furthermore, the report noted the major contributor to the increase in revenue was tax on goods and services with a significant increase of $7.5 million in excise as well $4.3 million in V.A.G.S.T. 

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