Deputy Prime Minister Manasseh Maelanga has highlighted key structural reforms taken by the Solomon Islands Government to enable business development at the Australia-Solomon Islands Business Forum currently underway in Brisbane.
In his keynote address at the Forum opening today (18 April 2023), Maelanga highlighted that tax reforms is a priority commitment which the Government has undertaken in consultation with the private sector regardless of the negative impacts of covid-19.
As a result of this commitment, the Government in September 2022 passed in Parliament the Tax Administration Act 2022 (TAA) that came into effect on 1st January 2023.
Under tax reforms, the Government further intends to introduce a Value Added Tax (VAT) reform in 2023. This is purposely to remove distortions and raise revenue more efficiently. The review will cover existing consumption taxes (Goods Tax, Sales), Stamp Duty, Accommodation Levy and Import Duty and to propose a new regime.
In addition to the tax reforms, Parliament had also passed the National Payment System legislation in 2022.
Furthermore, the Government had also endorsed the Policy Paper to make changes to the Financial Institutions Act (FIA). The FIA review is important to reflect current international standards and to modernize Solomon Islands’ financial sector.
The other important reform that is ongoing is the State-owned Enterprise Act. It is in this regard that Cabinet had recently approved a policy paper to review the State Owned Enterprise Act and its Regulations.
“The proposed amendment is aimed primarily to strengthen State Owned Enterprises’ performances and to support the country’s socio-economic development and growth,” Maelanga said.
State-Owned Enterprises (SOEs) play a vital role in the delivery of services in the country and is crucial that the State Owned Enterprises legislation undergo review so that these SOE can function more efficiently as desired.
In addition to the SOE reform, the Solomon Islands Government is also reviewing key utility regimes which include the Electricity legislative frameworks.
Furthermore, Maelanga also informed the Forum that significant reforms are also progressing in the mining and forestry sectors. The aim is to ensure good governance, encourage best international practice and to ensure sustainability in the sectors.
In addition, that the Solomon Islands Investment Policy will in-effect recommend reforms to the current investment legislative frameworks.
Solomon Islands is well represented at the Forum by participants from both the private and public sector over the next two days in Brisbane.