Overview:
An individual has been fined more than $5,000 for selling goods through Facebook without the proper license, prompting the Bureau of Revenue & Taxation to remind the public that online selling is regulated under Palau law. Here’s what you need to know before you sell online.
By: L.N. Reklai
KOROR, Palau (Nov. 17, 2025) — “Selling online is not automatically legal,” the Bureau of Revenue & Taxation warned as it announced that an individual has been fined more than $5,000 for operating an unregistered online business on Facebook.
The Bureau said an investigation by its Division of Audit and Compliance found that the individual was actively and repeatedly selling new goods through social media. Officials determined the activity did not qualify as casual, one-time, or occasional sales but instead constituted a business conducted for economic gain.
Under Title 40 of the Palau National Code, the Bureau defines a “casual sale” as a one-time or occasional sale of personal goods — excluding land — by someone who does not ordinarily sell such items. These casual sales are not treated as a business for tax purposes, but the Bureau stressed that individuals must still obtain a Peddler’s License, available for $20 per day, before conducting any casual sale.
The agency noted that many residents may not realize that online selling crosses into “commercial activity,” a term defined in law as any activity conducted for economic gain, including retailing, selling, or exploiting personal assets. Commercial activity — even if short term — may meet the definition of operating a business and requires proper registration.
The Bureau encouraged the public to review the legal definitions of “business” and “commercial activity” under 40 PNC §1002 to avoid unintentionally violating the law. It said the recent case serves as a reminder that online sales made for profit are regulated, and individuals who do not meet the definition of casual sellers may face penalties. (source: PR)