Through proactive collaboration and innovative strategies, we can build a stronger, more resilient tax administration framework that serves the needs of our nations.
Deputy Prime Minister and Minister for Finance, Professor Biman Prasad highlighted this at the Pacific Islands Tax Administrators Association (PITAA) and the Pacific Financial Technical Assistance Centre workshop at the Holiday Inn this morning.
Prof. Prasad says it is imperative to recognize the dynamic landscape of tax administration in the Pacific, characterized by the increasing presence of multinational enterprises (MNEs) and the evolving challenges of technical tax matters.
He says while a considerable number of taxpayers are doing the right thing and pay the correct amount of taxes, we continue to confront significant challenges related to tax planning and evasion.
The Deputy Prime Minister says while the increasing presence of international businesses in the Pacific region offers promising opportunities for economic growth, it also brings forth challenges concerning complex tax issues and domestic tax evasion within our Pacific nations.
He says the Pacific Islands Tax Administrators Association baseline exercise has identified key priority themes essential for effective tax administration in the Pacific.
Prof. Prasad says these include compliance risk management, knowledge sharing, and sub-regional collaboration with more vigilance against specific risks such as tax evasion, tax avoidance, transfer pricing manipulations, and base erosion and profit shifting (BEPS) practices is essential.
The Deputy Prime Minister says their foremost objective is to establish a tax system that is fair and ensures equitable distribution across society, thereby advancing social welfare.
He says additionally, the government prioritizes progressive tax policies aimed at fostering social inclusion, reducing poverty, and directing tax funds towards essential social programs and infrastructure development.
Prof. Prasad says today, they address a critical issue that affects that foundation of our tax system and the economic stability of our nations - Tax evasion.
He says this occurs when individuals or businesses deliberately under-report income, overstate deductions, or engage in other fraudulent activities to reduce their tax liability.
The Deputy Prime Minister says to effectively combat this challenge, they have employed a multifaceted approach by working together to develop tailored compliance solutions, streamline administrative processes, and address emerging compliance challenges more effectively.
He says investing in capacity-building programs for tax administrators and other relevant stakeholders is essential for strengthening our ability to engage with taxpayers and enforce tax laws.
Creating a tax environment that rewards voluntary compliance and penalizes non-compliance is essential for promoting taxpayer cooperation and trust.
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