Economy | TAX REFORM
The removal of PAYE for those who earn under $1.5 million will be made effective or retroactive to April 1, 2016
$1m tax free for all PAYE workers, threshold moving to $1.5m next April
The Government yesterday negotiated its first major fiscal hurdle
on the way to meeting pre-electioncommitments, announcing a two-phase increase in the personal income tax threshold from $592,800 to $1.5 million by next April.
Finance and Public Service Minister Audley Shaw, who was the target
of criticisms about the proposal, informed Parliament that the move means that, as of July 1 this year, workers who earn below $1,000,271 per annum will not pay any personal income tax, and that the threshold will rise to $1.5 million on April 1, 2017.
Retroactive Tax Relief Would Be Inequitable - Shaw
Quizzed last night on whether he had broken his promise by not awarding income tax relief retroactively to April 1, Finance and Public Service Minister Audley Shaw said that such a move would have led to an inequitable system.
"The retroactive promise would only have been to those that we initially had promised under the $1.5 million [plan]," Shaw said.
Shaw argued that the Government decided to "abandon the inequitable system of only selecting one category of people to get the benefit and decided to give the entire workforce that is on the PAYE (pay-as-you-earn)".
UPDATE: $1.5m income tax break could be delayed
KINGSTON, Jamaica — Minister of Finance and the Public Service, Audley Shaw, says that several challenges have been encountered, which may cause a delay in the actual implementation of the plan to increase the income tax threshold to $1.5 million, in the next fiscal year.
This income tax break was one of the initiatives highlighted in the administration’s 10-point plan for economic growth and prosperity, outlined in its manifesto.
“It is firm and irrevocable and my commitment is that even if it doesn’t start April 1, because of the budgetary process, it will at least be retroactive to April,” he said, reminding that the pay cycle for PAYE employees is at the end of the month.