By ESWIN PLESIO
PRIME Minister James Marape has assured Parliament that the Government will review the new infrastructure tax credit system following concerns that bureaucratic delays could affect development projects in resource-producing provinces.
Deputy Opposition Leader questioned the changes to Section 128A of the Income Tax Act, warning that centralising approvals under a board dominated by Waigani officials could delay roads, hospitals and schools promised to local communities.
He said provincial and district administrators, landowners and project developers should have a say in decisions affecting their areas.
The Deputy Opposition Leader warned that delays could create frustration among landowners, damage relationships
between resource companies and host communities and disrupt major projects.
He also questioned whether infrastructure commitments under existing gas agreements would be honoured, calling for a 60-day approval deadline and legal amendments to protect promised projects.
Marape said the changes were intended to ensure tax credit funds were properly managed by Treasury and distributed according to national development priorities.
He explained that the three per cent tax credit allocation would be divided, with 1.5 per cent for resource project areas, one per cent for other parts of the country and 0.5 per cent for Bougainville infrastructure.
Marape said the arrangement would help ensure communities benefited from resource development while allowing the Government to distribute funding to other areas.
He acknowledged concerns about the new system and said the Government was prepared to make changes if problems emerged.
“If the new Act has a teething issue, or the board is inconvenienced, or the board is not represented properly, then certainly this is not a holy commandment,” he said.
Marape assured Parliament that Cabinet would review the concerns and consider corrections during the upcoming budget sitting to ensure infrastructure projects were delivered without unnecessary delays.