Take Action: Stop logging company tax evasion

2016 May 4

The Panama Papers have helped expose how politicians, criminals and corporations around the world hide their cash and avoid taxes. In Papua New Guinea foreign owned logging companies are using some of the same tricks.

Papua New Guinea is now the world’s largest exporter of tropical timber, but it was recently revealed that most logging companies pay no corporate tax.

Meanwhile the government is slashing spending on vital services, including rural health, because of insufficient revenues.

We are calling on the Treasurer to launch an immediate investigation into the logging industry and its tax record - but we need your help!

Research by the Oakland Institute has exposed how most logging companies declare losses year after year, allowing them to avoid paying a 30% tax on their profits. This deprives PNG of hundreds of millions of Kina in much needed revenues.

It is clearly illogical for a company to stay in business if it makes loses year after year, but not only do these companies remain in business they are actually expanding their logging operations.

In total more than one-third of PNG is subject to some form of logging company control. This is because in recent years new areas of forest have been opened up using a mechanism called Special Agriculture and Business Leases. A Commission of Inquiry into these land deals found most of the leases are unlawful, but, despite three years of promises, the government has not cancelled any of them.

All over the country, local communities are being deprived of their resources while their government turns a blind eye to the deceptive practices of the forest industry and police forces that often work on behalf of logging companies.

Now there is substantial evidence of tax evasion and financial misreporting.

Please call on the Treasurer to investigate financial reporting by the logging industry and the government to cancel the SABL leases.