Increases in Income tax threshold, Because We Care Cash Grant, Old Age Pension; owning vehicles will be cheaper

Last Updated on Monday, 16 January 2023, 19:50 by Denis Chabrol

Finance Minister Dr Ashni Singh on Monday announced in Guyana’s 2023 National Budget that owning new and reconditioned vehicles below 1500 CC would be cheaper this year.

He said the importation of new motor vehicles less than four years old, below 1500 CC engine capacity would see a reduction of the duty from 45 percent to 35 percent . He said that would see Guyanese paying GY$200,000 less on the cost of a vehicle.

Dr Singh said the tax rate for reconditioned vehicles that are four years old and below 1500 CC engine capacity would be replaced by a flat rate of GY$800,000. He calculated that the cost of importing reconditioned vehicles of that capacity would be reduced by GY$300,000.

The Finance Minister also announced in the 2023 National Budget that the income tax threshold is now increased to GY$85,000 and the Because We Care Cash Grant has been hiked to GY$35,000 per child plus the uniform allowance of GY$5,000.

He said with the increase in the tax threshold from $75,000 to $85,000 will see more than 12,000 persons being removed from the tax net and “every single income taxpayer will benefit.” Dr Singh said that would mean that an additional GY$3.3 billion of disposal income being placed in the hands of beneficiaries.

The Finance Minister said the Because We Care Cash Grant would be increased this year from GY$25,000 per child to GY$35,000 per child plus the uniform allowance of GY$5,000 per child. That, he said, would benefit 214,000 school children in the government and privately-owned schools, amounting to GY$2.1 billion in additional disposable income.

The 2023 National Budget also provides for an increase in Public Assistance from GY$14,000 per month to GY$16,000 per month for 29,000 beneficiaries.  For the 73,000 Old Age pensioners, they would now get GY$33,000 per month up from GY$28,000.

Dr Singh said the 14 percent Value Added Tax on residential properties would be scrapped to reduce the cost of home ownership

All Electric Motor Vehicles of any power-rating and are less than four years old, he said VAT would be removed from those. Businesses, he said, would  allowed to write down 50 percent depreciation annually for those vehicles.

Government is projecting 25. 1 percent Gross Domestic Product (GDP) for 2023, with non-oil growth forecast to be 7.9 percent. Last year, Guyana’s economy grew by 47. 5 percent of which non oil growth was 7.7 percent

This year’s budget totals GY$781.89 billion.