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Pa Enua tax relief first order of business: PM

Saturday 28 January 2023 | Written by Matthew Littlewood | Published in Economy, National, Outer Islands

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Pa Enua tax relief first order of business: PM
Prime Minister Mark Brown. Photo: SUPPLIED

One of the first businesses of the new Government in Parliament will be to introduce tax relief for those living in the Pa Enua, says Prime Minister Mark Brown.

During the August 2022 elections campaign, Cook Islands Party campaigned on a tax-free threshold of $60,000 for those living in the Pa Enua. The previous “tax free” threshold was $15,000.

Brown says this will be under constant review, as things like minimum wage increase.

“The last major tax reform in 2014 was a result of people earning more money, and therefore paying more tax. It’s something called tax creep,” Brown said.

The policy proved controversial during the election campaign, with the Cook Islands United Party filing a petition accusing the Government of bribery, similar to the Cook Islands Party’s free fly-in votes in 1978, which resulted in the Electoral Court declaring the votes of the fly-in electors from New Zealand invalid.

Hearings were held in the High Court in October last year.

However, the petition was dismissed by then-Chief Justice Sir Hugh Williams in November, whose judgement said: “all parties, jockeying for votes, wanted their policies to be publicly attractive, so the notion that the CIP tax policy, as with other similar measures, was motivated by a corrupt intention recedes in credibility”.

PM Brown said there were other tax matters to be passed in Parliament.

“We’ve got some bills that are still outstanding, such as a bill that will allow smaller businesses to lodge VAT returns on a quarterly basis instead of a monthly basis,” he said.

“According to the Revenue Management Division, it means 70 per cent of their returns will now be quarterly. That’s a huge administrative burden you’re releasing from the Revenue Management Division, as well as from the companies itself.”

Brown said it would also attempt to pass a constitutional amendment that will allow for Parliament to sit even if petitions have not yet been resolved.

The country is waiting for the outcome of the election’s final petition hearing. The pending petition decision was filed by Cook Islands United Party candidate Margharet Matenga, alleging there were up to eight voters who voted in the Titikaveka electorate despite being ineligible to do so. Matenga lost to Cook Islands Party member Sonny Williams by three votes in the August 2022 general election.

A call-over hearing on the petition was held in the High Court in Avarua in December, after Williams’ appeal to have the petition struck out was denied.

Justice Colin Doherty, who oversaw the call-over hearing, directed the Court Registrar to set a date for the hearing of the petition on the first available date after February 24, 2023.

Cook Islands News understands that it has been estimated that the matter might take at least five days.

This would mean if the first available date is February 27, 2023, and the Registrar sets that date for the fixture, and the hearing does take only five days, and the Judge is able to deliver a decision immediately, then the first possible date for Parliament might be March 6, 2023.

In the election, held on August 1, the ruling Cook Islands Party won 12 seats and is able to govern with the help of three independents.

The Democratic Party won five seats, the United Party took three and the One Cook Islands Movement gaining one seat. Both main opposition parties lost a seat between the preliminary count on August 1 and the final count on August 10.