Tax holidays, although a good incentive for investments especially in the extractive industry, has the potential to lead to poor tax revenue collection from the sector in the long run. This was revealed in a research which was conducted by Ms. Ann- Tania Sipori at the recent 2nd Geoscience, Exploration & Extraction 2024 (GEE 2024) Conference in Port Moresby city. Before presenting the findings of her research to the audience in a packed APEC Haus, Ms. Sipori, who is the Mineral Resources Development Company (MRDC) Technical Manager, made it clear that the research she conducted was independent and does not reflect the views and opinions of the MRDC. She said a tax holiday is something to be reconned with because of its pros and cons in tax revenue for the country, which may lead to people having to pay higher taxes. She said it is a topic that not everyone wants to talk about, hence the reason for her independent research. She deduced from the research that a tax holiday is not the only form of incentive that a government can give to major developers in the resource sector as there are other forms of incentives that can be used such as Capital Gains Tax, which is a levy placed on profits from the sale of an asset. Ms. Sipori said Papua New Guinea (PNG) needs to look at countries like Indonesia and even Australia on how these countries manage their incentives and tax holidays. She said there are different varieties of tax holidays and there are different applications for tax holidays for different settings, and it also depends on the kind of project agreement signed with an operator. “These agreements are key to how tax holidays are interpreted,” she further explained. However, she concurred that there are some advantages to tax holidays acting as incentives. “Part of it is attracting new foreign investors, but from the MRA (Mineral Resources Authority), exploration has decreased, so did the tax incentive work?” she questioned when referring to what the MRA said at the GEE 2024 Conference on the decline of mining explorations in the country over the past few years. “Is tax holiday the only trump card to securing direct investment, no. It may be ineffective to promote business because we have just seen the decrease in exploration activities." She concluded by saying that there are options to collecting tax revenue, especially from the extractive resource sector and that should be explored further by the State instead of just looking at giving tax holidays to major developers in the future.