Parliament Passes Amendment on Investment Concessions

By Lagi Keresoma

APIA, SAMOA – 15 FEBRUARY 2022:  Parliament has passed the amendments to the principal Customs Act 2014 which is to streamline the work of the Investment Committee that reviews and approves qualifying projects that are exempted from paying customs duties and other incentives.

The projects that qualify under the Act include big construction developments projects, airline businesses, manufacturing, tourism, agriculture and fisheries.

The amendment was put through by the Minister of Customs and Deputy Prime Minister, Tuala Tevaga Iosefo Ponifasio and passed as a matter of urgency. He told Parliament that one of the major issues is the legal status of the Investment Committee.

He said this was realised in one of the very first meetings of the Investment Committee after the FAST Government took over where the Attorney General raised concern about the legal status of the Investment Committee.

This was challenged by the Opposition Party MPs such as the Deputy Leader, Lauofo Fonotoe Pierre Meredith, as if the Committee and the previous government had acted illegally in what the amendment seeks to “correct” the Principal Act.

Lauofo and HRPP Secretary Lealailepule Rimoni Aifafi continued the argument that the Committee acted legally over the years as it was guided by the Regulations in place under the Act.

The Minister assured that the amendment is to address the legal status of the Committee as removed from the 1977 Act when it was replaced by the Principal Customs Act 2014.

According to the Minister, the committee had been operating using the Regulations which no longer had power under the Customs Act 2014.

When the opposition MPs continued the same line of argument, Prime Minister Fiame Naomi Mataafa questioned if the Regulations still had any power if the principal act no longer has the basis of what those regulations draw their power from.

Tuala clarified that in the Customs Act 1977, there were provisions pertaining to regulations that guided the work of the Investment Committee.

That Act was repealed and replaced with the Customs Act 2014 which is the principal act.

“The problem and difficulty then was that there was no provision in the Act to establish an Investment Committee and its purpose,” he said.

He clarified that Cabinet had taken the advice of the Attorney General and decided to amend the Act to include the regulation of the committee’s work in the principal Act 2014.

Opposition MP for Anoama No.2. Lealai’asā Moefa’auō Sepulona Moananu supported the amendment.

He said Government does not get any direct financial benefits from such Act because all qualified projects are exempted from paying duty but only to attract investments.

He also pointed out that customs duty exemptions and income taxes are sides of the same coin, and he suggested that there should be a time limit and that investors being exempted under this scheme, must be made to pay income taxes down the line.

Before the amendment was passed, Tuala assured Parliament that the Ministry will do its best to have a comprehensive set of Regulations that will incorporate the suggestions by the Members, to guide the future work of the Investment Committee.