Papua New Guinea

PNG resident companies are liable for income tax on their worldwide income. Companies that are not resident in Papua New Guinea are only required to remit tax on income sourced in Papua New Guinea. A non-resident’s PNG-sourced passive income, including dividends, interest, and royalties, may be subject to WHT. It is ordinarily the case that the payer of the dividend, interest, or royalty must withhold the relevant amount of the tax and remit this to PNG’s Internal Revenue Commission (IRC).

Papua New Guinea levies corporate income tax (CIT) on companies on a flat rate basis.

Generally, trading profits and other income (except income that is specifically exempt) of resident companies in Papua New Guinea are assessed tax at a rate of 30%, whereas non-resident companies operating in Papua New Guinea are assessed tax at a rate of 48%.

The most recent budget also introduced a new income tax rate to apply to commercial banks. These entities will be subject to tax at the rate of 45%. 

Overseas shippers

Income derived by overseas shippers or charterers carrying passengers, livestock, mail, or goods out of Papua New Guinea is taxable in Papua New Guinea. The tax is calculated on a deemed taxable income equal to 5% of the gross income, which is taxable at the non-resident rate of 48% in the case of companies. The IRC may exempt the overseas shipper from tax if the shipper’s home country exempts PNG shippers from a similar tax.

Local income taxes

There are no provincial or local income taxes in Papua New Guinea.