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Controversial Games levy underway

Tuesday 17 November 2015 | Published in Regional

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NUKU‘ALOFA – A controversial levy on foreign exchange transactions in Tonga that has been deferred twice is finally due to come into effect on Friday.

The one seniti levy is to help pay for the 2019 Pacific Games which Tonga will host.

Questions have been raised about a lack of public consultation and NGOs have voiced concern over how the levy will affect people at the grassroots level.

Finance Minister ‘Aisake Eke says the levy has been delayed because of confusion around how it worked and inconsistencies between English and Tongan translations.

Dr Eke says banks will have to pay the government one seniti from each pa’anga of profit made from foreign exchange currency.

The minister says the levy goes a big way to help fund the games which are expected to cost just under US$40 million.

“This levy will be part of our fund-raising and will be enforced up until 2019-20 financial year so we are expecting at least two million pa’anga will be collected every year. So more than 10 million will be collected.”

Dr Eke says inconsistencies in the legislation will be rectified by parliament next year but until that happens the levy will only have to be paid by banks and not money exchange operators.

- RNZI