Tax Office Highway Robbery?
As of Monday, Feb. 10, 2014 car dealerships began paying excise taxes for imported vehicles at 25%, an increase from 10%, and this was confirmed by the new Chief of Customs, Moetulu’i Sipili Fuiava — who stated that it’s in the law.
In response to Samoa News queries Moetulu’i said this new policy has been approved by the Treasurer Dr. Falema’o Phil Pili after consultation on the issue and this followed “their” interpretation of the law on excise taxes.
Asked if the interpretation came from an attorney, Moetulu’i said no, rather he and the Treasurer had interpreted the law.
Samoa News further asked why the interpretation did not come from an attorney, and Moetulu’i did not respond.
Instead, he explained there are three car dealerships that will be affected and as they come to the Customs Office to claim their vehicles they will be informed of this newly implemented policy.
Moetulu’i did not comment when asked why this new policy has been implemented and why it was not publicly announced. Moetulu’i said that no memorandum has been issued on the new policy as of yet.
He said yesterday morning Halecks was informed of the new increase when they came to uplift their vehicles, however they left the Customs Office without taking their vehicles, because they were just informed of this new increase.
“The Customs will proceed with this new policy as planned,” the Chief Customs Officer said.
Moetulu’i explained that under the statute especially for Excise Tax on imports under Chapter 10, title 11.1002 (3) it is indicated that excise tax is twenty-five percent of the basis of motor bicycles, automobiles, trucks, and vans which will be used for commercial purposes and there is no tax exemption.
The issue came to light following several calls from members of the public who were only made aware of this new policy, noting that this will fall right back on the consumers.
One businessman said, “the government raises their taxes and the businesses will be left with no choice but to add that to the sale of the vehicle — and it’s the customers who will suffer, while the government benefits. Emails and calls to the Treasurer were not returned as of press time.
Samoa News understands one of the dealerships picked up their vehicles over the weekend — before Monday, Feb. 10 — the date Moetulu’i says the newly raised excise tax was implement, and the dealership is being asked to pay the difference between the old rate and the new rate of the excise tax.
The following is the statute Moetulu’i says he, as Chief Customs Officer and the Treasurer interpreted as allowing them to raise the excise tax on motor vehicles brought in by car dealerships from 10% to 25%, as of Monday, Feb. 10, 2014.
ASCA 10 —EXCISE TAX ON IMPORTS 11.1002 (3) ON VEHICLES AS FOLLOWS
(3) motor vehicles:
(A) twenty-five percent of the basis of motor bicycles, automobiles, trucks, and vans, to be used for commercial purposes; (B) notwithstanding the provisions of paragraph (A), the tax levied on motor bicycles automobiles, trucks, and vans, imported into American Samoa for personal or family use shall be 10 percent of the basis thereof. If a motor bicycle, automobile, truck or van, is converted to commercial use after being imported for personal or family use, it shall then be subject to the balance of the applicable tax imposed under paragraph (A).
(C) No tax exemption, including that provided by Title 11, Chapter 16, shall be granted for any motor vehicle. All other motor vehicles not taxed under this subsection shall be subjected to the tax under 11.1002(a)(7).