22 Jun 2010

Fears France will reduce aid to French Polynesia without local cutbacks

10:25 am on 22 June 2010

French Polynesia's vice-president, Edouard Fritch, says he fears France will cut funding if the territory fails to comply with the recommendations in a new report by French finance inspectors.

They visited Tahiti earlier this year and concluded that in the past decade, the territory had no growth while the population was getting older and poorer.

The report found that locally granted tax exemptions led to significant revenue losses, while the tax take was structured to rely on indirect income.

It notes that there were too many publicly owned entities that create confusion.

It proposes a tax reform and cuts of 30 percent to the operating budget.

It also advises not to replace retiring public servants and get rid of some of the vehicles owned by the administration.