Manila: The Asian Development Bank (ADB) and the Government of Solomon Islands today signed grant agreements amounting to $15.5 million to help improve the country’s tax system.
The agreements, part of the Domestic Resource Mobilization Project, were jointly signed by ADB Executive Director Tony McDonald, acting on behalf of the Government of Solomon Islands, and ADB Pacific Region Department Director General Leah Gutierrez.
The project is cofinanced by ADB and the governments of New Zealand, Australia, and Solomon Islands and will fund the restructuring of the country’s Inland Revenue Division, install a new tax administration information system, provide training to staff, and deliver a national campaign to increase taxpayer understanding and compliance.
"Work conducted through this partnership comprised of the Government of Solomon Islands, Australia, New Zealand, and ADB will help revitalize Solomon Islands tax system through the various reforms which will lead to a more transparent and fairer tax framework," said Gutierrez in a press release on Friday.
The project will expand and secure the country’s revenue base by building on Solomon Islands’ ongoing tax reforms, including modernization of tax administration law, a review of income tax processes, and the introduction of a value-added tax.
Women taxpayers and entrepreneurs will receive dedicated support through the project to ensure they are fully informed of the tax changes and encouraged to participate in the formal economy, leading to a more inclusive tax system.
The Domestic Resource Mobilization Project is funded through grants of $5.5 million from ADB, $6.5 million from New Zealand, and $3.5 million from Australia. The Government of Solomon Islands is also contributing $4.6 million.
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