Global Daily Tax News, PNG Cuts Corporate Tax On Banks, (Jan 6, 2025)

Papua New Guinea cut the corporate tax rate for banks on January 1, 2025.

As announced in the territory's 2025 Budget, released in late November and signed off by lawmakers in the first week of December, the Government is replacing the 45-percent single rate regime for banks with two rates, which will gradually fall.

From January 1, 2025, a 40 percent rate was installed for commercial banks on profits below PGK300m (USD74.8m). This rate will fall to 35 percent from next year.

For profits above this threshold, a 44 percent rate was introduced with effect from January 1, 2025. This rate will fall by one percentage point each year until the rate also reaches 35 percent.

Also on January 1, 2025, the Government raised the exempt threshold for first-time buyers from stamp duty from PGK500,000 to PGK700,000.

The Government has also increased the Tax Clearance Certificate (TCC) threshold for overseas remittances from PGK500,000 to PGK1.5m. Taxpayers are therefore no longer required to obtain a TcC for aggregate annual remittances below PGK1.5m, provided the destination is a non-tax haven country.