Mining Giant Faces Multi-Million Dollar Tax Evasion Fine in Papua New Guinea

Port Moresby - The Internal Revenue Commission (IRC) of Papua New Guinea has announced a K11.79 million tax assessment fine against an unnamed mining company for involvement in a tax evasion scheme.

IRC Discloses Large Tax Evasion Fine

During a press conference, IRC Commissioner General, Sam Koim, made the disclosure without specifically naming the company due to ongoing legal proceedings.

Instances of Visa Violations and Tax Evasion

Mr. Koim drew attention to multiple instances of visa violations and tax evasion. He stated that foreign workers were being brought in on visas from one company but were actively working for multiple companies.

• Foreign workers holding business visas were working in entry-level positions within their companies.
• They often received their payments through offshore bank accounts, reducing the taxes they owed to the Papua New Guinean government.

Partnership with Immigration and Citizenship Authority

To combat such malfeasance, the IRC has formed a partnership with the Immigration and Citizenship Authority to address immigrants and businesses found to be in breach of the country’s tax and immigration regulations.

Significant Discrepancies in Work Visas

Mr. Koim shared that investigations had revealed significant inconsistencies, specifically with foreign workers holding business visas while working in entry-level positions within their companies, thereby circumventing their tax obligations to the Papua New Guinean government.

Our investigations have uncovered substantial discrepancies between the number of foreign workers holding work visas and the group employee declarations submitted to the IRC.

IRC’s Response: Project Masta

In response to the evasion of payroll taxes through work visas, the IRC recently launched a new project named ‘Project Masta’ to investigate foreign workers and their employers regarding their compliance with Papua New Guinea’s tax laws.

Mr. Koim expressed his determination to curb this tax evasion challenge and reaffirmed the agency’s commitment to enforcing the Income Tax Act.