Income Tax Act

In a media statement, ASFPNG stated that this decision will affect Bank South Pacific Group (BSP), the largest bank in PNG and the Pacific, of whom, superannuation funds on behalf of ordinary workers and tax payers are major investors / shareholders. The imposition of this new banking levy will result in a decline in profitability, dividend payments to shareholders and a decline in BSP’s share price. 

This follows changes to Section 46B of the Income Tax Act and Rates Act in regards to Long Service Leave Paid on Termination.

In the 2018 Budget, changes were made to Section 46B of the Income Tax Act and the Rates Act in order to rationalise the treatment of certain payments made to employees on termination of employment.

From 1 January 2018, certain payments of long service leave, made upon termination of employment, attract concessional rates of salary or wages tax.