The Guyana Revenue Authority (GRA) today said that all taxpayers will have more take home pay under the income tax changes announced in the 2017 budget.
GRA in a statement noted that Minister of Finance Winston Jordan had announced that the rate of Income Tax will be determined in proportion to the individual’s gross earnings.
However, GRA said that persons have since expressed alarm in the public domain that this calculation would result in especially medium and high income taxpayers taking home less net pay than currently at the 30% rate.
GRA noted that it was stipulated that a monthly gross income of $180,000 or less will be taxed at the rate of 28% with a proposed threshold of $60,000 while monthly earnings above $180,000 will be taxed at two rates of 28% and 40% for every dollar of chargeable income. However, it is important to note that the threshold for a person earning more than $180,000 will be one-third (⅓) of their gross salary, the GRA said. Notwithstanding this, such individuals will attract the 28% Income Tax rate on the first $120,000 of their chargeable income and a 40% Income tax rate on every dollar of chargeable income above $120,000.
GRA “urges persons not to be despondent since, according to the calculations based on the proposed formula, all categories of individuals will be taking home higher net salaries or income in 2017, which will be more than they would have taken home in 2016 based on the current rate of 30%.”