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ENSURING OUR FUTURE
SURVIVAL
Total Government expenditure is expected
to increase to a massive $27.9 billion dollars. Most of this is to be spent on social projects e.g. education, housing, security,
health as well as developmental works in keeping with Government’s Vision 2020. Government’s main objectives in the coming years 2005-2007 include keeping the
rate of inflation at 4% and attaining full employment.
The economic outlook appears favorable
with growth projected at 6.7% for 2005, 8.9% for 2006 and approximately 5% in 2007. Most of the increased revenue is expected
to come from improved revenues from the energy sector. The rates of income tax, corporation tax, business levy and green fund
levy have basically remained the same except that-:
a. The personal allowance has been increased from $25,000 to $30,000. This would
benefit those
in income brackets $25,000 - $35,000 as shown
below-:-
Illustration
|
Gross Income |
26,000 |
30,000 |
32,000 |
34,900 |
|
Personal Allowance |
26,000 |
30,000 |
28,000 (1) |
25,100 (2) |
|
Taxable |
NIL |
NIL |
4,000 |
9,800 |
(1)
$25,000 + $5,000 – ($32,000 - $30,000) = $28,000
(2)
$25,000 + $5,000 – ($34,900 - $30,000) = $25,100
(b) Business
Levy would be removed from January 2005 from registered small businesses. A definition of this is still awaited.
The minimum wage is to be increased
from $8.00 to $9.00 per hour from January 1st 2005. This would impact on the operating costs of all businesses.
A summary of the other measures is listed below-:
1. Old Age
Pension – increased to $1,150.00 per month – from
October 1st 2004.
2. Disability
Assistance Grants – increased to $800.00 per month –
from October 1st 2004.
3. Chicken
and Turkey Parts – surcharge dropped from 86% to
40% - from November 1st 2004 (surcharge should end by
December 2004).
4. Removal
of Common External Tariff on – split peas, black eye
beans & cheese.
5. Zero
Rating of Vat – on brown sugar, cocoa powder, coffee,
mauby and orange juice.
6. Duty
free allowance for passengers in respect of personal items
from $1,200.00 to $3,000.00 per annum.
7. Set-off
against employment or professional income of losses from
other sources (e.g. rental income) would be stopped.
8. Employees
of school, educational institute, charities and
municipalities no longer would get beneficial treatment of their
benefits in kinds.
9. Of major interest is the fact that the Board of
Inland Revenue
would now be able
to retain one’s Vat Refund and apply it to any
outstanding tax
owed by the individual/company. This is effective
from January 1st
2004.
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