From the House, Minute No. 25. Tuesday July 27. The Minister of Finance said that the Sales Tax would be terminated and replaced with a Consumption Tax next year and small businesses would not be required to keep any records. He said that the method of collecting taxes would be different.

- Discussion over a move by 'Akilisi Pohiva for the House to debate on clause 15 of a bill which has been voted on, and passed the day before.

- Small businesses will not pay Consumption Tax directly.

- Difficulty in translating Electronic Address into Tongan.

- What does "Conflict of Interest" mean to government?

- Increase of Penalty for giving false tax information was raised from $1,000 to $10,000.

- The passing of a Bill to amend the Mental Health Act.

- Looking for treatment for hatred and jealousy.

- Someone poisoned the mind of the leader of the country in order to be given $50,000

- The leader's mind was not poisoned, but the $50,000 was approved by the Cabinet and it went through Parliament and in other places.

Speaker ...– said that the House would continue with the regulation on how government was collecting its revenue. He reminded members to avoid repeating themselves and he also called on Cabinet Ministers to clarify issues for members.

The Legislature dissolved and the Acting Chairman of the Whole House Committee, Noble Tu'i'afitu took his Chair.

Chairman ...– called for the proceeding to continue with the Regulation to administer the collection of government revenue 2003. He said they would start with Clause 16 of Chapter 8.

'Etuate Lavulavu ...– expressed his concern over forms that were stated in Clause 16 and regulations stated in Clause 15.

'Akilisi Pohiva ...– asked for the House to go back to Clause 15.

(There was an argument between the two members, 'Etuate said that they had already passed Clause 15 and according to the House's Rules and Regulations they could not go back, but 'Akilisi said that they had not passed Clause 15).

Chairman ...– told 'Akilisi to explain his point.

'Akilisi Pohiva ...– said he wanted to delete of the Tongan translation of the words "Shall Have Effect" in sub-clause 3 of Clause 15.

Minister of Justice ...– pointed out that the House had already voted and passed Clause 15 and the deletion of "Shall Have Effect" was not necessary.

Chairman ...– called for the proceeding to continue with Clause 16.

'Etuate Lavulavu ...– expressed his concern that the forms to be filled by small business people with a turn-over of less than $100,000 would be very difficult for them to follow. He suggested for workshops to be held in the villages to educate them on how to fill in the tax form.

'Akilisi Pohiva ...– said that there were courses for small businesses already in operation, and there was no need for extra courses.

Minister of Finance ...– said that the Sales Tax would be terminated and replaced with a Consumption Tax next year and small businesses would not be required to keep any records. He said that the method of collecting taxes would be different. In the new system the tax-payer would be taxed on the figures that he provided, unlike the current practice of the figures being assessed and the tax payers were asked to resubmit their tax returns.

Dr Feleti Sevele ...– asked the Minister to confirm if it was correct that small businesses with turn-overs of less then $100,000 would not pay Consumption Tax and therefore have no need to keep any records.

Minister of Finance ...– said that they would pay Consumption Tax when they imported goods from overseas but not when they resold these goods. He said that the requirement under the law would be too much for these small businesses to keep all those records.

Dr Feleti Sevele ...– wanted to know what about businesses with turn-overs of more than $100,000 who would prefer to do the same and pay at the wharf, and avoid having to fill tax returns.

Minister of Finace ...– under the law it would not be possible, but we could look at it.

Dr Feleti Sevele ...– said that the advantage of paying at the wharf was that there was no need to keep all the records and avoid making mistakes and the extra costs for keeping all those records, which at the end would be added on to the price of goods which would be paid for by the consumers.

Minister of Finance ...– said that a business with a turn-over of more than $100,000 was not a small businesses.

Minister of Labour ...– expressed his concern that if small and big businesses would be allowed to pay for their consumption tax at the wharf then they would not solve the problem that we have been having at the wharf, where custom officers have been blamed for corruption. He said that if the intention was for small businesses only that it should be only for small businesses.

'Uliti Uata ...– said that the Minister should be very careful about how he implemented the consumption tax. He said with regards to small businesses, most Tongan businesses are small businesses, and if they would be clearing their goods from the wharf then we would continue to face the same problem that we have today. He asked the minister to look carefully at his new tax because it seemed that he was just replacing the Sales Tax with the Consumption Tax.

Trevor Guttenbeil ...– said that if the consumption tax would be collected at the wharf then it defeated its own purpose.

Chairman ...– moved Clauses 16 to 24. It was seconded. He said for proceeding to continue with Clause 25.

'Etuate Lavulavu ...– moved for the Tongan translation of electronic address, "tu'asila 'uhila to tu'asila fakakomipiuta" or more correctly "tu'asila 'ilekitulonika".

Minister of Justice ...– said that "tu'asila 'uhila" is consistent with the translation used in other legislation, but he would check and get back to the House in the afternoon.

'Akilisi Pohiva ...– queried the membership of a Tribunal and the view stated that was expressed that a member could not be in the tribunal if there was a conflict of interest. He wanted to know what was the government's stance on the issue of Conflict of Interest, because there was an inconsistency in their part, they enforced it in some cases and not in others.

Minister of Justice ...– said that the principal of Conflict of Interest should be prevalent at all times.

Dr Feleti Sevele ...– said it was rather unusual that the penalty for knowingly filing wrong tax information was $1500 while the penalty for not filing tax return on time to be $10,000. He moved for the penalty for knowingly filing wrong information to be increased to $10,000 or imprisonment for not more than five years.

Minister of Justice ...– agreed with the member that fraud and providing false information were serious crimes, but he said that the reason was in order to speed up the process and for such case to be heard in the police magistrate.

Dr Feleti Sevele ...– emphasised for the penalty to increased from $1,000 to $10,000 or imprisonment to increase from three months to two years.

(the motion was seconded by the Minister of Justice).

Chairman ...– called for votes on Dr Feleti Sevele's motion. It was passed 17-1. Against was Noble Nuku.

Minister of Justice ...– requested for the House to accept the Tongan translation of Electronic Signature as " Tu'asila 'Uhila", because that translation had been used in other legislations that have been passed by the House.

Chairman ...– called for votes on the Extra Ordinary Gazette for regulation to administer the collecting of government revenue in 2002 and 2003.

It was passed 17-1. Against was 'Uliti Uata.

Chairman ...– called for proceeding to continue with a Bill for an Act to Amend the Mental Health Act.

Minister of Health ...– said that the Act was passed in 2001 and became law, but after it was printed a number of errors were discovered in the English version, a lot of spelling errors and parts missing out.

Chairman ...– called for vote and it was passed 18-0. He said for the proceeding to continue with the Bill to amend the Act on Medicines.

'Etuate Lavulavu ...– wanted to know if the Minister had got any medicines for hatred and jealousy. He said that a research has been carried out and Tongans have an unusually high cases of hatred and jealousy.

'Isileli Pulu ...– said that the Member had said on the TV that the treatment of hatred and jealousy was to massage with pages of the bible, and that he was suggesting to use it on them.

'Akilisi Pohiva ...– wanted the Minister of Health to explain what he meant with the term, poisoning of the mind.

Minister of Health ...– said that it was the translation of the English word narcotics, which has became known as "Faito'o Kona". He said that in medical terms they were not referring as medicine to poison people's minds but to treat people, particularly people with very aggressive attitudes. He said that among medical people they knew what they were talking about, but it was difficult because there was no good Tongan translation.

'Akilisi Pohiva ...– with regards to the comment made by 'Etuate Lavulavu about poisonous mind, he wondered if the minister could help because it had cost a lot of damage to the country and to the work of government.

He wondered what could happen if some one could poison the leader of our government to give him $50,000. He said he was puzzled by how could this person poison the mind of the highest person in the land in order for $50,000 to be given to him in an unlawful way. How could it happen in this country, he wondered. How could this person sneak by and poison the machine that runs this country, then he accepted $50,000. He said that was like sneaking under the fence.

Minister of Police ...– said that the member was not debating on the law, unless if he was talking about mental illness. He said he wanted to correct what was said because the member was referring to the leader of the country, and even though an amount of governmentfunds had been handed over but it was not by the leader of the country. He said that the processing of releasing the fund followed the proper channel, it went to Cabinet, then to the Ministry of Finance then it came here and it had been around. He said that the member was poisoning minds by pointing at something else other than what the House was working on.

'Akillisi Pohiva ...– said that the matter was started by 'Etuate Lavulavu and then no one including the Minister of Police stopped him or corrected him, but he had said what he thought was very important for the members to take home for the day. He said that this latest case of poisoning was devastating to the country.

Chairman ...– called for votes and the bill was passed 17-0. He said for the proceeding to continue with the Bill to amend the Tobacco Act.

Speaker ...– called for vote on the second reading of the Extra Ordinary Gazette on a Regulation to administer the collecting of government revenue 2003. It was passed 16-0. After its third reading it was passed 16-0.

After the second reading of the bill for the amendment of the Mental Health Act it was passed 18-0. It was also passed in its third reading 18-0.

The Bill for the Amendment of the Medicine Act had its second and third readings and was passed 18-0.