LANDOWNER COMPANY SETTLES K120 MILLION LEGACY TAX LIABILITY
Wednesday, 08 February 2023.
Petroleum Resource Kutubu (PRK) presented a mock cheque of K120 million today to mark the completion of its legacy taxes.
PRK’s had tax disputes since 2011, and in 2019, all of these issues were resolved, resulting in a total tax liability of K120,758,504. Given that this was a considerable amount to pay, the Commissioner General placed them on a structured payment plan based on their cash flow. The final monthly repayment was made in January 2023, marking the complete settlement of the debt.
PRK is a subsidiary of Mineral Resources Development Company (MRDC). It was incorporated in 1989 under the Companies Act to hold the landowners and provincial government equity interest in the Kutubu Petroleum Project. PRK currently holds a 6.75% stake in Petroleum Development License 2 (PDL2) and 1% of PNG LNG.
At a small but significant press conference held today at the Internal Revenue Commission (IRC), the Managing Director of MRDC, Mr Augustine Mano, expressed his relief after this huge payment debt and assured all the companies under his watch are also reordered to be tax compliant.
Mr Mano thanked the Commissioner General for putting PRK and all their companies through a payment arrangement to settle their outstanding debts.
PRK Chairman John Kappi Natto said, “sometimes, people think that landowner companies will not be paying taxes, but today we are showing that we can pay our fair share of the taxes. Today, it reflects the governance of the landowner companies who continue to pay their taxes.”
Mr Kappi Natto expressed concern that although so much is extracted from their resources and they are paying these taxes, they are not seeing basic government services like roads, schools and hospitals being provided to the resource landowners. He urged the Government to look back at the resource owners as the Oil and Gas were going to run out.
He thanked Mr Mano and MRDC for running the resource companies and ensuring that the companies under MRDC continue to comply with their tax obligations. He committed to continue to comply with their tax obligations.
IRC Commissioner General Sam Koim acknowledged and thanked PRK and MRDC for completing the payment of their legacy tax liability. He expressed his gratitude that on top of allowing the extraction of their natural resources for the benefit of all, the resource owners are also considerate to pay their fair share of taxes to be further redistributed through the taxation process for the benefit of all.
The Commissioner General praised PRK as demonstrating exemplary compliance behaviour and urged all taxpayers with legacy tax problems to discuss their tax problems with the IRC to establish similar payment plans to suit their cash flow. He urged taxpayers to follow similar due processes to resolve their legacy tax problems.
Authorised for release
Mr. Sam Koim, OBE
Commissioner General
IRC Press Release
8th /02/2023
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