The Vanuatu Prime Minister Charlot Salwai has confirmed income tax is being seriously considered by his government.
He made the announcement at the diamond jubilee Santo Lycée celebrations in Luganville saying the planned tax will apply on incomes of more than 500,000 vatu a year, or $US4,674.
Mr Salwai said the tax is needed if the government is to fund activities such as free education for children up to year 10.
The Daily Post reports him saying every country in the world levies this tax and Vanuatu has to start taking more responsibility for paying for its development.
When the government introduced free education up to Year 6, Australia funded the initiative, but every year since the Vanuatu Government has slowly absorbed the costs and will fully fund the programme from next year.
Mr Salwai says by year 10 people become responsible and are able to decide their destiny and providing free education up to year 10 would fulfil the country's obligations to the United Nations Convention on the Rights of Children.