– from $35,000 to $40,000 monthly
– other increases in Old Age Pension, Public Assistance
THE largest budget under the current administration, $161.4B, was unveiled yesterday in the National Assembly, and Guyanese can expect increases in the income tax threshold, public assistance and old age pensions, among the many other benefits.
Finance Minister Dr. Ashni Singh announced that the tax threshold has been raised from $35,000 to $40,000 monthly (from $420,000 to $480,000 annually); the public assistance has been increased from $4,900 to $5,500 monthly; and old age pensions increased from $6,600 to $7,500.
“There is no investment more important than in our people,” he asserted.
According to Singh, these increases are effective from February 1, 2011.
He stated that as it relates to personal income tax, Guyanese will pay as much as $20,000 less in income tax in a year, and approximately 38,000 Guyanese will no longer be paying taxes, as they will be removed from the income tax net.
The last time the income tax threshold was raised was in 2008, when it moved from $28,000 to $35,000.
In 2009, public assistance received a five per cent hike, and according to the Finance Minister, the increase from 2010 to now is estimated at 12 per cent.
Over 19,000 persons are expected to benefit from this increase.
“Four years ago, in 2006, public assistance was paid at a rate of a $2,350 per month. This latest increase has the effect of causing the rate, which is to be paid from next month, to be more than double the 2006 rate,” Singh said.
Similarly, the increase in old age pensions is more than double the 2006 rate, and is a 14 per cent increase over the current rate, $6,600.
The Finance Minister stressed that the current administration is making several moves to ensure that Guyana’s elderly are supported.
“Rehabilitation works to the physical infrastructure of the Palms Geriatric Institution is ongoing, while the newly constructed recreation facility is operational with a reading room, exercise room and canteen services, all intended to improve the quality of life of the residents,” he said.
Old age pensions benefit over 42,000 persons.
Some $3.6B was expended on subsidizing water payments for qualified pensioners in 2010.
“Efforts will be placed on providing more opportunities for improving the physical and social well being of our elderly in social services and health care, in addition to the continued financial support in the form of old age pensions and water payment subsidies,” Singh assured.
Prior to 1992, old age pensioners were subject to a ‘Means Test’, which verified that they had absolutely no ‘means’ of support.
When the administration took office, it promised that there would no longer be a ‘Means Test’, and this was effected in 1993, the following year.
Currently, to benefit from an old age pension, a person has to be 65 years old, a Guyanese, and living in Guyana two years prior to receiving this benefit.
The late Dr. Cheddi Jagan’s contention was that all Guyanese, regardless of their means, once they have attained the pensionable age, are entitled to the benefit of an old age pension.