17/04/2025
The Internal Revenue Commission PNG (IRC) held a breakfast session with the Lae business community yesterday, to explain tax relief measures introduced by the national government to address economic pressures and streamline compliance.
The removal of Goods and Services Tax (GST) on 13 essential items, dubbed the “basket of goods,” was explained to the Lae business community. This includes everyday necessities like rice, canned fish, cooking oil, and soap.
By setting the GST rate to zero on these products, the government aims to lower their retail prices, offering direct financial relief to households grappling with the rising cost of living. The IRC plans to implement this change by July, pending detailed groundwork to ensure it works as intended.
Another key relief target for small businesses was that companies with annual revenues below K1.5 million no longer need to file GST returns every month. Instead, they can submit these quarterly, reducing administrative burdens and freeing up time and resources.
This shift addresses the challenges faced by smaller enterprises, which often lack the staff or systems to handle frequent tax filings.
For first-time home buyers, the stamp duty exemption, a tax break on the legal costs of buying a home, has been increased from K500,000 to K700,000. This means buyers can avoid stamp duty on properties valued up to K700,000, making homeownership more accessible in a market where prices often strain budgets.
The IRC also spotlighted a full tax exemption on superannuation withdrawals. Workers who have worked 15 or more years of service can now access their retirement savings without being taxed. IRC Commissioner General Sam Koim flagged this as a priority for awareness, noting its potential to bolster financial security for long-term employees.
"As a tax administration, we are not just interested in collecting taxes but also would like to help ease the burden of tax compliance.
"In the last budget, there were a couple of changes that were made and a lot of reliefs were offered as well, including the ‘basket of goods’ for the 13 essential items to help ease the burden on households. Our team is working to have that relief effected in July this year", Koim said.
"There’s also a relief where taxpayers are now exempted from coming to the tax office every time when they exhaust their limit. So now, they at least have a K1.5 million to remit to the offices,” he added
Commissioner of Tax Samuel Loi provided insight into the GST relief’s rollout, affirming that the IRC team is currently g*thering information, adding that business houses should anticipate a survey to determine which brands are commonly sold, in what sizes, and to also see how sales codes are applied to the different items.
The IRC is teaming up with the Independent Consumer and Competition Commission (ICCC) to monitor businesses, guaranteeing that the tax savings trickle down to consumers.
