The other tax-free loophole that will attract stars to PNG
Papua New Guinea has become an even more financially attractive destination for potential NRL players after it was revealed that third-party winnings will be tax-free.
The Chiefs will enter the player market on November 1 before entering the NRL competition in 2028. In an effort to encourage players and officials to sign, the Australian and PNG governments brokered a deal that would allow all winnings to remain tax-free.
According to Australian Rugby League chairman Peter V’landys, there is now an even bigger sweetener to shift to the Pacific nation; Third party agreements (TPAs) also fall under tax-exempt status. These deals will not count against the salary cap.
“Any income they earn in PNG is tax-free,” V’landys said. “It’s all tax-free, as if you were filing a tax return in PNG.
“Playing in PNG will prepare them for life. We used the Brisbane Broncos as a one-city team. It’s a one-country team where people are fanatic about rugby league.
“Can you imagine 10 million people following a team? It’s a monopoly because it’s the only sport played there. People don’t realize how great PNG is going to be.”
Justin Olam is an example of third party opportunities available in PNG. The former Storm and Tigers star had more than half a dozen personal sponsors; these include ExxonMobil, Samsung, Ok Tedi Mining, Nasfund pension fund and Papua New Guinea Tourism Promotion Authority. After all, the former Storm center was making more than $300,000 a year from his glamor.
PNG’s biggest companies will be clamoring to become commercial partners of the new series, while those who missed out on the opportunity will likely turn their attention to individual player sponsorship opportunities.
“There is a definite opportunity here because of the public interest in rugby league and corporate support,” Olam manager David Rawlings said.
“There will be a lot of local businesses specifically looking to connect with players. In PNG, it’s all about access to rugby league players.”
After breaking Ken Irvine’s 53-year-old try-scoring record, South Sydney winger Alex Johnston has expressed interest in finishing his career in PNG. Considering his profile and achievements, he would be a marketing dream for businesses.
PNG could potentially offer $1.5 million per season to a marquee player. If PNG could earn an additional $400,000 from its sponsorships, this would be equivalent to an annual salary of $3.5 million in Australia when tax benefits are taken into account.
While some experts remain skeptical about whether PNG’s inclusion in the competition will be successful, V’landys has no doubt it will benefit the country on and off the field. The Australian federal government will invest $600 million over 10 years to support rugby league in PNG.
“There are still a lot of haters who criticize PNG, but they have no vision,” V’landys said. “10 million people are fans of one sport, the whole country will follow it. It will be incredible.”
