Personal Income Tax has been reduced from 30 to 28 percent for persons earning less than GYD$180,000 per month and the Income Tax threshold has been increased to GD$60,000 or one-third of the gross salary, whichever is greater.
Finance Minister, Winston Jordan said in the 2017 National Budget that an additional 7,600 persons would be taken off the tax register with the increase in the tax threshold.
In relation to the reduction of the income tax on salaries and wages of less than GY2,160,000 per year, he said an element of progressivity in the tax system. That means there will be a new rate of 40 percent Income Tax on salaries more than GYD$2,160,000 per year.
“It can be easily demonstrated that the individual will be better off under this new regime,” he said, explaining that individuals earning GYD$2 million annually will pay GYD$102,000 but under the new regime an individual earning less will pay taxes totaling GYD$78,000.
“These measures will allow for an annual increase in take-home pay to persons earning under GY$720,000 per year of GYD$18,000 and those earning GYD$2,160,000 they will take home an additional GYD$46,800.00.
He said Guyana would lose GYD$3.9 billion that can be used to boost personal savings and consumerism.
The Finance Minister said there would be a reduction in the mortgage interest relief to loans of GYD$15 million or less for low and middle income earners.