An overview of Papua New Guinea’s tax system, provided by KPMG’s Port Moresby office.

Papua New Guinea’s tax laws are administered by the PNG Internal Revenue Commission (IRC) and customs laws by the PNG Customs Service.

The general company tax rate, at 30%, is reasonably comparable in the region.

Individual taxpayers who earn only PNG salary or wage income, which is taxed at source, are not required to lodge annual tax returns.  While domestic personal tax rates can be viewed as relatively high by world standards a number of fringe benefits are taxed at concessional rates.

Currently PNG has no capital gains, death (probate) or gift taxes. However, the PNG Government has announced its intention to introduce a fairly limited scale capital gains tax which will impact sales of interests in real properties or companies holding such property.

There is a well-developed set of withholding taxes on various overseas remittances.

A number of formal Double Taxation Agreements (DTAs) with selected other countries also exist to provide additional certainty and commercial flexibility for genuine investors.

It should also be mentioned that a complete rewrite of the income tax legislation has been announced and a first draft of the technical tax sections has been released for comment.  It will be supported by a new taxation administration act and Regulations.  The following discussion is based on the assumption that the approaches and administration in the current legislation will be maintained but this remains to be seen when final legislation emerges.

See also

• Corporate Tax Guide
• Personal Tax Guide
• Superannuation tax considerations
• Withholding and other taxes
• Double tax agreements
• Goods and services tax (GST)
• Tax incentives
• Tax clearance requirements
• Mergers and acquisitions
• Tax rates at a glance

This guide to Papua New Guinea’s tax system is produced by KPMG’s Papua New Guinea office and is reproduced here with permission.