The Government through the Council of Ministers (COM) at its meeting of August 8, 2016, has agreed that Vanuatu will consider the introduction of personal and corporate income tax. This is confirmed by the COM Decision 143 of 2016, the Government announced today.
Earlier this year the Government announced its intention to reform the taxation system by reviewing the existing taxes, non-tax revenues and as well as the modernisation of the Department of Customs and Inland Revenue. The review aimed to make the taxes more efficient and effective and also to explore the possibility of introducing new taxes to meet the growing demands for service delivery. The exercise took into account the modelling of various options including increasing VAT and Excise and concluded that personal income and corporate tax is the best option as it will produce the most viable outcome and less likely to impact low income earners.