The Internal Revenue Commission (IRC) announced this during the opening of the Small Business Tax Forum on Port Moresby today.
The Small Business Tax Forum aims to inform MSME’s operators and stakeholders on the new tax law
The two-day Small Business Tax Forum began today in Port Moresby with a good turnout of MSME operators.
The Small Business Tax Forum aims to inform MSME operators and stakeholders on the new tax law and the requirements associated with it.
The SBT will be introduced on the 01st of April.
“We are intending to implement it by the 01st of April this year,” said IRC Commissioner General Koim.
Over the next two days MSME’s and stakeholders will presented information on SBT Registration, SBT Filing, SBT Payment, Record Keeping and Bank Account, Transitioning from SME into SBT, and Incentive for SBT.
One of the main goals of the SBT is to entice MSMEs and various informal businesses to get on board the new tax regime as well as transition into the formal economy.
This is done by simplifying the tax regime for MSME’s.
“The whole idea of this, the first one is formalising those who are operating outside of the tax regime. The second aim is to grow their businesses,” said Koim.
The SBT was passed in 2019 by the Marape-Led Government to reduce the compliance burden on MSME operators and to introduce concessional tax rates to individuals operating MSME’s.
SBT is a tax on turnover of gross sales and has two segments – micro businesses and small businesses.
Micro Businesses who make less than K60, 000 are taxed a flat rate of K250.
Small Businesses with a turnover under K250, 000 is regarded as a Small Business and they pay tax quarterly in the following arrangement. Tax on the first K15, 000 is K62.50 and any sale smade in excess of K15, 000 is taxed at 2%.
Day One of the SBT Forum focused on Information on the SBT while Day Two will focus on general Tax Administration and Compliance under Income Tax Regime.