Tautua Whip Lealailepule Rimoni Aiafi has slammed the new National Provident Fund (N.P.F.) levy increase.
Earlier this month, Cabinet approved an increase for the N.P.F. from five per cent to seven per cent, with a one per cent increase per annum.
According to a Cabinet release the new rates will start on July 1, 2015.
In an interview with the Samoa Observer, the Member for Faleata West said the new charge was just another form of tax.
“I was reading the N.P.F. Act today…apparently they have a right under their Act to increase their levy, they call it their levy,” he said.
“But I believe that it is not a levy ,it is a tax.
“It is an indirect form of tax because it is something that is imposed on us without our say.
“So it is a tax.”
Leala said the decision to increase the fee should have come to Parliament for discussion.
“I thought it should come to Parliament,” he said.
“Because it is going to be at 14 per cent in two years time.
“It is 10 per cent now and that is a lot of money for most people, employers. “I believe it shouldn’t be an administrative matter it should be up to Parliament to increase this.”
He said the new fee would impact heavily on employers.
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“It will have an impact on their budget and they might end up reducing staff to cover for that increase,” said Leala.
“So that is why it should have come to parliament for that increase,” he said.
Furthermore, Leala said because the issue affected all workers and employers the public should have at least been consulted about the increase.
“So it should be a matter for everybody to contribute to, to agree to or at least the majority, at least the employers,” he said.
“I don’t think that it is the right time or the proper time to do it.
“They should have consulted the public, especially the employers before they come up with an increase.
“Not only the employers but also the employees.
“Because (in) other countries it is an option whether you take the money and put it into your own (provident) account.
“But here it is compulsory it goes into N.P.F.”
He said it was just another “tax” imposed on people at a time when the economy is struggling.
“And also at this time when the economy is not really doing well and also business closing down and they do this,” he said.
“The transport sector is increasing their fares, E.P.C. the water everything all the rates are going up at the same time.
“So something is not right somewhere when they increase all these rates now given the state of the economy.”
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