Papua New Guinea

New Income Tax Act 

In March 2024 the Income Tax Act 2025 was passed. It is planned to take effect on 1 January 2026.  

Although the intent was broadly a simplification of the current act and an update in language used, the new act will represent a significant change in policy and will impact on all taxpayers operating in the country. 

The most significant changes for individual taxation include:

• Taxation of employment benefits: The taxable value of certain benefits (in particular motor vehicle) has been changed and increased. There are also some additional benefits included. 
• More controls on the ability of employers and employees to enter into salary packaging arrangements with limits placed on the relative value of non-cash benefits. This 60/40 rule has been in tax authority policy, but is now part of the new act.

Although the act has been passed, there is still a requirement for subsidiary regulations to be drafted and released as well as amendments to the Taxation Administration Act in order to give full effect to the new regime. These changes should be in place before 1 January 2026, although there is no indication of current release of drafts or any consultation. 

If the matters above are relevant to your circumstances, then these potential changes should be considered and discussed with a PwC contact.