VAT

Speaking at a public forum at the Grand Hotel in Port Vila, Vanuatu, yesterday the visiting ILO Senior Wage Specialist, Daniel Kostzer said he noted that compliance had been an issue in the implementation process of VAT and pointed out that the income tax would just be more complex than managing the current Value Added Tax regime.

Kostzer said what we need is a household survey and a lot of analysis etc that would give us a clear number of our labour market covering household expenditures etc.

In a radio interview this week, Martin Hilaire of the Chamber of Commerce of Vanuatu, called on the national government to drop the proposal to raise income taxes, and, instead, hike the rate of value added tax.

Currently the rate of Value Added Tax in Vanuatu is set at 12.5 percent, and Martin Hilaire claimed that it should be raised by 2.5 percent to 15 percent.

It was explained that currently only 26 000 people in Vanuatu are registered for the Vanuatu Pension Plan, indicating that less than 10 percent of the population is included in the tax net.