Palau capital gains tax: none, a fee on land sale proceeds
Palau has no personal capital gains tax, so the tax on your investment gain is zero. Shares, funds, crypto and land alike, a private disposal carries no tax on the gain, whatever the holding period. What a land sale does carry is a 4% fee on the proceeds, charged on the price rather than the gain.
Verified as of 2026-09-30 against the Unified Tax Act and the Land Transaction Proceeds Fee notice of the Bureau of Revenue and Taxation.
Current rules
Taxes on selling shares, crypto and property in Palau
What you pay when you sell
| Asset | Tax on the gain |
|---|---|
| Shares | Nothing. The sale of stocks is excluded from gross revenue under the Unified Tax Act |
| Crypto and funds | Nothing on the gain for a private investor |
| Land | Nothing on the gain. A 4% fee applies to the sale proceeds from 1 January 2023, whether the sale makes a gain or a loss |
| Selling as a business | Receipts from trading assets other than stocks, bonds and land count as business income, taxed at 12% of net income under the Business Profits Tax |
| Wages and salary | 6% on the first $8,000, 10% from $8,001 to $40,000, 12% above $40,000, not applied to capital gains |
Questions
Palau capital gains tax questions
Does Palau have a capital gains tax?
No. Palau has no general personal income tax, and the Unified Tax Act excludes receipts from the sale of stocks, bonds and land from the gross revenue it taxes. The only individual income tax is the wages and salary tax. Whether you sell shares after a week or land after twenty years, the gain itself is not taxed.
So what does selling land cost?
A 4% fee on the proceeds of the lease or transfer, in force since 1 January 2023. It is charged on the price, not the gain, so it is owed on a sale at a loss too. PGST at 10% applies on top where the transaction is subject to it. A lease from a public lands authority to a Palauan citizen or a wholly Palauan-owned business is exempt, but a later sublease is not.
Are shares taxed when I sell them?
No. A sale of stocks is excluded from gross revenue, and no transfer charge on share sales sits among the taxes the Bureau of Revenue and Taxation administers. Dividends and interest from Palau sources are a separate matter, taxed to a business as gross revenue.
Is crypto taxed in Palau?
Not as a capital gain for a private investor. A person who trades crypto as a business is taxed on the receipts as business income, at 12% of net income under the Business Profits Tax once registered for PGST.
What does the Unified Tax Act say about capital gains?
Palau has no capital gains tax on an individual's disposal of shares, funds, crypto, land or other property. The Unified Tax Act (Title 40 of the Palau National Code, section 1002(o)) defines the gross revenue on which business is taxed and excludes "gross receipts from the sale of bonds or other evidence of indebtedness or stocks, or from the sale of land"; the Ministry of Finance's Economic and Fiscal Update states that the reformed regime "does not include a general personal income tax". Sources: https://www.palaugov.pw/wp-content/uploads/2022/04/Palau-National-Code-Title-40.pdf ; https://www.palaugov.pw/wp-content/uploads/Economic-Fiscal-Update-FY2024.pdf
Does the wages tax reach a capital gain?
The only tax on an individual's income is the wages and salary tax, which does not reach a gain on a capital asset. Title 40 section 1101 taxes "wages and salaries received by every employee", and section 1002(o)(4) removes wages from business gross revenue. Source: https://www.palaugov.pw/wp-content/uploads/2022/04/Palau-National-Code-Title-40.pdf
When is a sale taxed as business income?
Receipts from disposing of a capital asset other than stocks, bonds or land enter the gross revenue of a person carrying on a business, so a sole proprietor or company that trades in an asset is taxed on it as business income; an employee or private investor making a casual sale is outside the tax. Section 1002(d) lets the Director of the Bureau of Revenue, Customs and Taxation exclude casual sales from the definition of "business". Source: https://www.palaugov.pw/wp-content/uploads/2022/04/Palau-National-Code-Title-40.pdf From 1 January 2023 the Business Profits Tax replaces the Gross Revenue Tax for PGST-registered businesses at 12% of net income, with gross receipts from the sale of stocks, bonds and land excluded. Source: https://www.palaugov.pw/taxreform/bpt/
What is the fee on a land sale?
Land is charged on the transaction, not the gain: from 1 January 2023 a 4% fee is imposed on the proceeds of any lease or transfer of land, for any purpose, when neither the Business Profits Tax nor the Gross Revenue Tax applies to the transaction. It is owed whether the sale makes a gain or a loss, in addition to PGST where PGST applies. A lease granted by the Palau Public Lands Authority or a state public lands authority to a Palauan citizen or wholly Palauan-owned business is exempt, and a later sublease by that person is not. Source: https://www.palaugov.pw/taxreform/land-transaction-proceeds-fee/
Is there a charge on selling shares?
Shares carry no transfer charge: no Palau tax on a sale of stocks appears among the taxes the Bureau of Revenue and Taxation administers (PGST, Business Profits Tax, Gross Revenue Tax, wages and salary tax, international transportation tax, non-resident withholding tax, occupancy tax, excise tax and the land transaction proceeds fee). Source: https://www.palaugov.pw/executive-branch/ministries/finance/brt/