By paying no VAT the supplier managed to increase his mark up for a reasonable personal gain. The VAT Office has already spot fined the retailer and will also fine the supplier for not complying with the conditions on the exemptions provided by the Director of Customs and Inland Revenue.
In another case a concrete block (brick) manufacturer not registered for VAT purchased sand and cements without paying any VAT. In this case the supplier is currently being interviewed and will be instructed to re-issue an invoice including VAT and will also be spot fined.
The VAT Office will continue to conduct its Compliance and Monitoring exercise until 12th June 2015 and will uplift relevant sales reports from the suppliers to identify possible suspected cases.
The VAT Compliance and Monitoring teams have also issued a number of spot fines to retailers who have been found not recording the daily sales correctly and in some cases not recording anything at all. Repeated offenders are reminded that the VAT Office will take prosecutions actions and will follow these cases through the proper legal process.
The VAT Office would like to remind everyone that Section 57of the VAT Act No 12 of 1998 [CAP 247] provides the Director with the authority to inspect any records that he considers necessary or relevant for the purpose of establishing a registered person’s correct VAT liability. Such records will include all business records and in some cases may extend to personal records such as statements from private bank accounts.
Specifically, section 57 provides that:
i) The Director will at all times have full and free access to all records whether they are in the custody of the registered person or any other person.
ii) The Director is authorized to make extracts from, or copies of, any records without making payment of any fee to any person.
iii) The Director may remove and retain any records he considers necessary or relevant.
Our Officers are delegated by the Director of Customs and Inland Revenue and are responsible for the collection of VAT for the Government of Vanuatu. They are during these difficult times conducting the crucial task of Compliance and Monitoring checking on the businesses (those not affected by tropical cyclone Pam) to make sure that their VAT records are up to date and that they are correctly accounting for the VAT and in the appropriate VAT returns (periods). The VAT Office welcomes your support in doing the right and legal thing, right from the start.
For more information on any of our articles published in our weekly column, please contact the VAT Office by phone: 00678 24573 or email us at
