Last Updated on Monday, 10 August 2015, 21:57 by GxMedia
by Zena Henry
Minister of Finance Winston Jordan has proposed an amendment to the Income Tax Act Cap. 81:01 to do away with taxes placed on National Insurance Scheme (NIS) contributions. The Minister in his Budget speech said that the amendment seeks to insert after Section 16(b): “(i) National Insurance contributions by employees.”
Jordan highlighted that with this amendment, “workers will no longer be paying income tax on their national insurance contributions.”
“In addition,” he continued, “to the tax threshold, the Commissioner General must deduct the NIS contributions of the worker before determining his chargeable income.”
Jordan said it will result in a loss of revenue of about $1.3 billion annually but, importantly, it would result in a net increase in the disposable income of all workers.
“This measure will be effective from Year of Assessment 2016.”