Tonga prepares for new tax on April 1 [1]
Tuesday, February 1, 2005 - 15:45. Updated on Saturday, May 3, 2014 - 16:31.
The Minister of Finance, Hon Siosiua T Utoikamanu, on January 31 released for public scrutiny the Consumption Tax Act 2003.
In a government press release the Minister reminded the business community and consumers that the Consumption Tax Act will come into effect on 1 April 2005.
He said that the Consumption Tax "will be charged at a rate of 15% on the value of all imports and most goods and services sold in Tonga." and will replace the old Ports and Services Tax (20%) and Sales Tax (5%).
He said that the businesses with an annual turnover of $100,000 or more will be required to register for CT, which will then enable them to charge CT on their goods and services, "collect CT and pay this to the Revenue Services Department".
The Minister of Finance said that the new tax system is designed to be fairer for all taxpayers, simpler to administer, and promote social and economic development within the Kingdom.
He said that a new division of the Revenue Service Department, called the Large Business Division had been established to administer the tax. "Revenue Service staff from this division will soon visit the 260 or so large business taxpayers who will need to register for CT. The visits will assist those businesses to prepare themselves for the new CT, which will come into force on 1 April 2005," he said.