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Road Use Tax Amendment, RPPL No. 9-18 2013



To amend the provisions in Chapter 12 of Title 40 of the Palau National Code relating to the gross revenue tax, to amend the Road Use Tax, and for other purposes.


Section 1. Legislative Findings. The Olbiil Era Kelulau finds that with the enactment of the recent minimum wage law, and with the continued requirement that employers contribute 2.5% toward the Palau National Health Insurance, the private sector needs an additional economic stimulant so that it will continue to grow. This bill will provide a tax break to companies; before they calculate gross revenue to be taxed, the entire salary or wages paid to Palauan citizens is deducted from amount of the gross revenue, and up to $5,000 in salary or wages paid to foreign workers. The Olbiil Era Kelulau finds that this tax break will counter the effects of the minimum wage law on small business that are hard-pressed to meet the new requirements.

Section 2. Amendment. 40 PNC § 1404, as amended by RPPL No. 9-10, is hereby amended to read as follows:

"§ 1404. Road use tax.

(a) There is hereby assessed and levied an annual road use tax on all motor vehicles, including vehicles owned by all agencies of the National Government, state governments and state agencies, and public corporations. All agencies and public corporations that may be exempt from taxes under other laws of the Republic shall pay the road use tax. The road use tax shall be payable at the time required for registration of each vehicle to be assessed the road use tax as follows:

. . .

(3) All motor vehicles weighing between four thousand (4,000) pounds and six thousand (6,000) pounds-- one hundred fifty dollars ($150). Any person who paid a two hundred dollar ($200) road use tax in accordance with RPPL No. 9-10 shall receive a credit of fifty dollars ($50) towards their future road use tax liability.

. . ."

Section 3. Effective Date. This Act shall take effect upon its approval by the President of the Republic of Palau or upon its becoming law without such approval, except as otherwise provided by law.

PASSED: November 20, 2013

Approved this 29th day of November, 2013

Tommy E. Remengesau, Jr.
President of the Republic of Palau

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