AS part of its negotiations for a salary increase for public servants, the Guyana Public Service Union (GPSU) is recommending that the income tax threshold be increased to $120,000.
The union is also pushing for a revision of the formula that is used to calculate pensions for public servants.
This was announced at a press conference held, on Wednesday, at the union’s Regent Street Headquarters.
It was disclosed to the media that there are a number of measures that the union will be lobbying for, including tax reforms.
“The GPSU submitted, in its budget proposals for 2021, that the tax threshold should be $120,000. The GPSU also submitted proposals for the review of pensions paid to retirees. The GPSU has called on the government to meet within the time stipulated in the agreement for a meeting upon request,” GPSU Vice-President, Dawn Gardener, said while reading the union’s prepared statement.

In a proposal sent to the Senior Minister in the Office of the President with responsibility for Finance, Dr. Ashni Singh, the union is also calling for a reduction of the tax rate to 20 per cent, and a reduction of VAT to 8 per cent. The union shared a copy of the document at the press conference.
In Guyana, the income tax (PAYE) threshold currently stands at $65,000, which means individuals only pay tax on the amounts earned after the first $65,000 is deducted. Individuals are taxed 28 per cent on amounts up to $130,000 above the first $65, 000. An incremental rate of 40 per cent is charged indefinitely on taxes above the $130,000. The union noted that the income tax rate is higher than the Company Tax which stands at 25 per cent.
It was explained that given the conclusion of the budget debates and passage of the budget in Parliament, now is the opportune time for the commencement of negotiations on salary increases for public servants. The union is looking for retroactive salary increases for 2020 and 2021.

“Public service workers have had no increase in earnings since January 2019, which is more than two years ago. During this period, there were increases in revenue in the government coffers. The revenue referred to is distinct and separate from the revenue received from the proceeds of oil,” President of the GPSU, Patrick Yarde said. The union said it has written to President Irfaan Ali, following a lack of response to correspondence sent to the Ministry of Public Service (MoPS)’s Permanent Secretary (PS), Soyinka Grogan, on a request for the commencement of the salary negotiations.
“The union has sought the intervention of His Excellency, President Ali, in a letter dated March, 16, 2021 and thanks him in advance for his involvement and support,” the union’s statement said.

Following the passage of the budget in February, Vice-President, Bharrat Jagdeo, affirmed that salary increases are catered for in the budget. This pronouncement was made in response to claims that the proposed 2021 budget did not include any monetary incentive for public servants.
Vice-President Jagdeo had said that over $10 billion has been budgeted in the estimates under the heading, “revision of wages and salaries”.
“A huge part of that sum will go towards salary increase for public sector workers,” he explained.
The Guyana Chronicle understands that previous PPP/C governments are known for setting aside a “lump sum” of money, which is later used to provide salary increases and other monetary incentives.