27 Feb 2006

Tax reform crucial for nation's survival, says Solomons finance minister

7:24 am on 27 February 2006

The Solomon Islands caretaker finance minister Peter Boyers says the tax system must be improved to ensure the country's economic survival.

The government is proposing to scrap the Goods and Sales Taxes and replace them with a single, lower-rate Value Added Tax.

Mr Boyers says goods tax and import duties combine to create taxes-on-taxes as high as 43 per cent.

He says the current system is killing businesses and making it difficult for new ones to become established.

"It's whether this government, or the next government, they're going to have to follow through on this tax. And if I don't come through in the next election, well I'll be here in the chamber of commerce pushing for it, because I know it's a good thing and I'll be very happy to be presenting something I believe in. So, yeah, I think the government's doing a good job in doing this, and I think whoever the government is next is going to be doing this as well."

Mr Boyers says it's clear Solomon Islanders want a better tax system and that VAT will provide the answer.