2023 budget: loggers and banks to see tax increases in January

Logging companies and banks will be paying more taxes in 2023 as the government
sets its sights on increasing tax revenue.
Treasurer Minister, Ian Ling-Stuckey  has announced an additional 20
percent increase on log export taxes as well as an increase on a tax on the
banking sector from 30 to 45 percent.

He made the announced in parliament when he tabled the K24 billion 2023
budget.

The tax on loggers  builds on existing efforts to stop log exports by
2025 and encourage downstream processing in the country.

In 2020, the government imposed a tax on round log exports. In 2023, an
additional 20 percent will be added on.  The Treasurer said K30 million
generated from this tax will be used to support the UN backed trust fund.

Banks, meanwhile, have been hit with a 45 percent tax – a 15 percent
increase expected to generate K220 million for  the government purse.

While banking sector is yet to respond to the announcements from a profits
standpoint, the most obvious long term  impact will be on  superfunds
whose members contributions  will be affected.

Superfunds who own shares in banks like BSP will likely see a dip in
dividend payments in the next financial year.

Treasurer Ling-Stuckey has announced support for PNG households. In
January,  the minimum tax free threshold will be increased from K13,000 to
K20,000 and fuel excise suspended for six months until June.   This
means minimum wage earners earning a maximum of K20,000 will not pay income
tax.

The law and justice sector will see funding increases in 2023. The
government has allocated K401 million for police, the judiciary and other
related sectors.  The funding will support the increase in police numbers
from 5000 to 7000 in in 2026.

More than K4 billion has been earmarked for  infrastructure development
with K960 million primarily for district infrastructure alone.

Health an education will also see increases next year with the treasurer
indicating more support for frontline workers