MP’s tax-free to be scrapped - Solomon Star News

MP’s tax-free to be scrapped

20 March 2019

ABC: For the first time in four years, Member of Parliament (MP) will be required to pay tax on their salaries.

Solomon Islands' Parliamentary Entitlements Commission (PEC) will be gazetting the new regulations on April 1 to remove, tax exemptions that were granted in 2015.

Commission Chairman Johnson Siapu has confirmed the changes with ABC, which come into place on the back of widespread public consultations last year.

The Commission granted the tax exemptions for MPs' salaries in 2015, claiming that politicians' pay was too low in comparison with CEOs at state-owned enterprises.

The award led to public protests with people taking to the streets for what was known as the 'red shirt protest'.

A High Court ruling revoked the award but that was later overturned by the Court of Appeal.

The new changes come into place just two days before the Solomon Islands' national election on April 3, which means parliament is dissolved.

That has raised questions about its legality, but Albert Kabui who is a former legal advisor to the National Parliament said what the Commission has done is completely above-board.

"The Parliamentary Entitlements Commission is established by the Constitution it is independent in that sense it does not operate subjected to Parliament being in session," Mr Kabui told Pacific Beat.

Mr Kabui said a salary review was part of the Commission's normal function.

"What they do is they ask for submissions from the public or relevant stakeholders. They give their submission to the Commission and based on this submission, that is how the PEC amends or reviews regulation," said Mr Kabui.

"After they do that, they'll send it to the Attorney General for vetting and for drafting and once its ready they wait for April 1st to come into effect."

While the new regulations will hit the pockets of the country's incoming MPs, it is expected to have the support of most political parties.

A number of political parties had previously told Pacific Beat they support a tax on MPs' salaries.

Former Prime Minister Gordon Darcy Lilo and leader of the Party for Rural Advancement said he supports taxing MPs.

"If the good Lord Jesus paid tax, why would members of parliament in Solomon Islands be exempted from tax," he told Pacific Beat.

Matthew Wale's Solomon Islands Democratic Party has also spoken out in favour of taxes.

"I think its immoral that members of parliament be exempted from paying tax when they have to decide where taxpayer funds are to be allocated," said Mr Wale.

The president of the Kadere Party, Peter Boyers said he also supports tax.

While taxing MPs may get wide public support, Mr Kabui said it's important that the Commission is reformed once a new government is formed.

Mr Kabui said this is to avoid a conflict of interest, with two out of the five Commission members serving MPs.

"Looking at the composition, you can see its not entirely independent in influencing how they decide in reviewing regulations."

He said this could be the long-term solution to ensuring this new ruling on MPs' pay stays in place.

By Evan Wasuka
On Pacific Beat