New Guinea

Doesn't Want It

Duty-Free

The Papua-New Guinea com mercial world generally has ; received with a notable lack of

enthusiasm proposals that duty

[free shops be introduced to the

? territory as an encouragement to

tourists.

THE territory Administration agrees with commerce, and it is not likely that the territory will get these facilities for the present.

A report outlining attitudes was tabled in the September session of the House of Assembly on behalf of a Government committee.

The seven-page report is a useful document for any other Islands ter ritory interested in the problems of duty-free shopping.

The committee said that if duty free ports were set up in P-NG revenue amounting to $10,530,000 out of an estimated internal revenue of $34,180,000 for the 1965/66 financial year, would be lost to the territory, and it was questionable whether the removal of duty would generate extra business generally.

It was not practicable that one or two ports only should be declared duty-free in isolation, as this would lead to problems of smuggling.

Duty-Free Concession

It was practicable to introduce duty-free concessions on tourist goods, such as transistors, watches and binoculars—as Fiji had done. The revenue lost (about $300,000 during the 1965/66 financial year) could be compensated for in several ways, such as imposition of a port and customs charge; imposition of a stamp duty for every import and export entry lodged; the raising of duty on other items in the tariff schedule; the raising of company and personal income tax; or the intro duction of an ad valorem statistical tax of, say, one per cent., on the value of export and import entries.

However, a considerable section of the community might regard this as an unwarranted imposition.

It said the idea of duty-free shops was also “not welcomed” by territory businesses because these would create a monopoly resented by other retailers. If they had to have anything,

business people preferred the lower ing of duty on tourist items, as sug gested, rather than complete removal of duty on everything, as it was thought that such a move “might attract too many people into merchandising and render established traders’ operations uneconomical”.

The committee was in agreement with general business opinion in the territory that the problems of tourist accommodation and transport would first have to be overcome before the territory worried about duty-free con cessions as an inducement to tourists.

The report for the first time throws

some light on the refusal of the Australian Government to make duty free facilities at Sydney’s airport available to travellers to the territory.

The same ban also applies to travel lers to Norfolk Island, The report explains that it is the New Guinea Administration which has “not encouraged” the Australian Government to make duty-free facilities available to travellers to the territory, “because this would affect the trade of territory businesses sell ing this class of goods”. So the problem is in the territory’s own backyard.