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Trade and Economic Development Minister Tax of informal sector is WRONG

Radio & TV Tonga, Nuku’alofa, 29/08/2019

The minister for trade and economic development says it is wrong to tax those in the informal sector, namely the fishermen and growers who sell their produce.

Dr. Tu’i Uata says it is not right to tax people who make a living out of selling their produce at the markets or hosting a garage sale, elaborating that for those who sell items at the flea market, the items they are selling arrived in Tonga from abroad and the vendor has already paid the taxes for that shipment and that’s done.

In an interview with the minister, he queried why tax had to be collected again when people sell the content of that shipment? He said tax collection should be from those who have registered as a business and have a Taxpayers Identification Number – TIN to reconcile the money they are collecting from customers and the tax paid at customs, and if there is any outstanding balance than that is the tax they will pay to government.

The minister said he wanted to make clear to the people that this was the truth according to the law and was a legal fact. He said government does not touch the revenue fishermen and growers make from selling their produce and that it was just wrong to tax them.

However, it was confirmed from the Ministry of Revenue and Customs, that any person who is selling a product to make a profit, SHOULD be paying tax according to a LAW that had come into effect in 2008.

Also it was clarified that there are certain individuals or entities that are not required to pay tax including the King, non-profit organizations, and diplomatic corps.

The Ministry of Revenue says the law clearly states that anyone selling a product to make profit should be paying tax but for the moment they are more focused on those who are practically running a business with their garage sale or the products they sell at the market due to how often they are selling their products.

© Radio and Television Tonga News