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SERVE: International companies leaving TL

Dili Weekly - July 25, 2018

Paulina Quintao – The Executive Director for Business Registration and Verification (SERVE), Florencio Sanches said they recently received applications from four big international companies with the intention of closing their business in Timor-Leste due to low earnings.

He said from the four companies, three companies are set to close their business, while the other one has only ceased activities after receiving advise from SERVE.

He added in 2017, two or three companies each day submitted a request for closure because they were not making any money.

"I am disappointed with the big foreign companies. They make huge profits of more than $50 million, but decided to close the company because they were not able to get any contracts last year," he said from his office, in Matadouro, Dili.

He added that Tax Law No. 8/2008 states that companies that do not generate any income do not have to pay tax but must report nonetheless their earnings (or lack of). He informed also that SERVE register daily 40 or 50 companies.

He said the closure of several businesses is concerning because the private sector pays for the salaries of the public sector through paid taxes.

At the end of the day, he said, it is up to the company if it chooses to close because the government does not have a mandate to stop them.

On the other hand, National Member of Parliament MP David Diaz Ximenes said the current political situation is affecting badly the private sector, both national and international companies because many have not been paid by the government.

If this continues, investors will withdraw their investment and new ones will not come to Timor-Leste to invest.

"It will lead to an economic crisis, without investment our people will lose their jobs, there won't be goods, children will not go to school and the rate of unemployment will strongly increase," he said.

He appealed the government to present and discuss the National Program to the National Parliament immediately for approval to ensure people's livelihoods.

Source: http://www.thediliweekly.com/en/news/15867-serve-international-companies-leaving-tl