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 through branches and permanent establishments are taxed at a rate of 48%.
Commercial banks will be subject to tax at the rate of 45%.
Papua New Guinea has transfer pricing provisions that require transactions with foreign affiliates to be conducted on an arm’s-length basis. Provisions follow an OECD based approach. Disclosure of such transactions is done through an international dealings schedule (IDS). Corporate taxpayers with transactions or dealings with international affiliates that exceed PGK 100,000 in an income year or have aggregate loan balances with international affiliates in excess of PGK 2 million at any time during an income year are required to prepare and file international dealings schedule with their income tax return for that year of income.