-employees will have greater take-home pay

THE new tax measures announced by Minister of Finance Winston Jordan will inject some $9.595 billion into the Guyanese economy, a release from the Department of Public Information noted.

According to the release, this represents the amount which the government will forego from the national treasury and is in effect a massive stimulus package. It was noted that the reduction of the Value Added Tax (VAT) from 16% to 14% alone will dent the national treasury by $4.8 billion, while the loss from the reduction in Personal Income Tax will cost another $3.8 billion.

Following are the details of how much each measure is calculated to cost the treasury:

1. VAT reduction from 16% to 14%:
Cost to treasury: $4,817,000,000
2. Reduction of Personal Income Tax from 30% to 28%:
Cost to the treasury: $3,826,000,000
3. Reduction in Corporate Tax from 30% to 27.5%:
Cost to treasury: $752,000,000
4. Increasing of VAT threshold from $10m to $15m:
Cost to treasury: $200,000,000
Total cost to the treasury: $9,595,000,000

These figures have been provided by the Ministry of Finance.
“Further, the Government of the Cooperative Republic of Guyana assures all employees that under the new proposed Personal Income Tax system, ALL employees will have a take-home salary, come January 2017, which is higher than their current take-home salary,” the release noted. Persons are asked to use the Salary Calculator at www.dpi.gov.gy/salary which computes salaries under the new system. The Salary Calculator will show the increased take-home salary, total taxes to be paid and the National Insurance Scheme contribution.