When the previous government introduced the Tax Invoice Monitoring System (T.I.M.S.) in June 2019, it was plain sailing at that time with Samoa’s economy doing well. 

The then administration was keen to ramp up tax collection as well as address tax evasion and the new electronic monitoring system was hailed by the then Human Rights Protection Party (H.R.P.P.) regime as a long-term solution to its revenue collection plans.

An ambitious timeline was laid out by the previous government which would have seen the TIMS go live in January 2020. 

But no one foresaw the tragedy that was to unfold beginning October 2019, when the first signs of a measles outbreak in Samoa began to surface, and over the four months that followed went on to claim over 80 lives.

In early 2020 as the dust from a deadly measles epidemic settled, a mysterious outbreak of a virus in China caught the world’s attention: the emergence of the coronavirus (COVID-19), with its deadly rate of infection, forced a shutdown in international travel to gradually lead to the collapse of the global economy.

On the home front, companies both large and small didn’t have time to recover from the measles epidemic. 

In fact they had barely resumed business in the new year when the then government declared a state of emergency (S.O.E.) in March 2020, subsequently shutting Samoa’s international borders to protect the country from the COVID-19 pandemic, with the S.O.E. remaining to this day.

Since then it has only been downhill for our private sector with the collapse in the global economy reducing and then cutting Samoa’s exports and the closure of international travel literally strangling our tourism sector.

Last week the Samoa Bureau of Statistics (S.B.S.) released its report for the June 2021 quarter showing that the country’s economy continues to decline, 18 months since the COVID-19 pandemic-triggered recession began.

According to the S.B.S. report Samoa’s total economic output for the June 2021 quarter fell by 8.1 per cent on an annual basis, signalling the tough times that laid ahead in terms of rebuilding the economy.

A lot of businesses were forced to close their doors over the last 18 months, which included tourism operators as the Samoa Tourism Authority C.E.O. Fa’amatuainu Lenata’i Tuifua revealed last month.

Fa’amatuainu said a mammoth 52 hotels have closed while 48 are still operational out of the 144 hotel operations in Samoa that the Samoa Tourism Authority has on its records.

So with the country’s private sector in a bad state with most small-to-medium sized businesses either closed or partially open, the question needs to be asked whether the operation of the T.I.M.S. in the current economic environment is in the nation’s interest or will in the short-term become a hurdle to businesses trying to rebuild after a chaotic pandemic-impacted 18 months.

Therefore, we welcome the directive by the Cabinet to the Ministry of Customs and Revenue (M.C.R.) for a review to be done on the TIMS with a particular focus on small businesses and whether they can afford the taxation system.

Prime Minister Fiame Naomi Mata’afa told her weekly media conference on Friday that the Cabinet decided during the week for the responsible Minister and Ministry to undertake a review of the web-based monitoring tool. 

She said the review will consider various aspects and whether the monitoring tool is effective, taking into consideration the challenges and whether it is a burden on small developing businesses. 

We look forward to the review the M.C.R. will undertake in line with the Cabinet’s directive and hope that it will include extensive consultation with members of the private sector and its key stakeholders such as the Chamber of Commerce.

One of the major concerns that businesses initially had with the previous administration’s rolling out of the T.I.M.S. was the issue of cost as the initial price of setting up the system appeared to be beyond the means of a lot of small businesses.

The Prime Minister’s inclusion of small business’ affordability in the terms of reference of the Ministry’s review is a step in the right direction.

Local businesses in the current economic climate are in dire need of support to survive the pandemic – the best way forward for both the private sector and the Government – would be to delay the implementation of the electronic taxation monitoring system and for the review undertaken by the M.C.R. to be done holistically.

This should include the question of whether the T.I.M.S. would add value to the rebuilding of an economy from scratch, following the decimation of key economic sectors by a pandemic.