Japanese used car

PAPUA New Guinea is losing millions of kina in tax and import duty fees as vehicles are being smuggled into the country bypassing tax regulatory measures set in place by the Government.
Internal Revenue Commissioner General David Sode has admitted that the scam involves some of the IRC’s customs officials.
“We are aware of such scams in IRC, especially the customs branch and have seized large numbers of vehicles that had been smuggled in this way,” Mr Sode said.

It is alleged that custom officials at the IRC were collaborating with customs agents to bring vehicles in large quantities into the country, especially second hand vehicles.

These vehicle dealers deal directly with customs agents in order to bypass the tax regulatory measures set in place by the government.
The customs agents then collaborate with the IRC Customs officials who tamper invoices to write lower tax cuts for the vehicles, it is alleged.

Some of the vehicle dealers travel overseas to purchase vehicles and upon return produce receipts that show the date of the purchase dating back to more than six months. Items that are brought into the country that had been used overseas for more than six months are classified as personal items, therefore higher tax rates are exempted, it was alleged.

An official from the Department of Transport attached with the road transport industries division that overseers licensing of the vehicles in the country, said that most dealers import their vehicles from Japan and Singapore.

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