Minister Audley Shaw announced in May last year, an across the board threshold for individual tax payers of just over $1 million per year, effective July 2016, estimated to cost $12 billion in lost revenues this fiscal year. Data in Governments’ fiscal operations to November this year, is now showing that the cost will be far less than originally stated.
According to the inflows of PAYE, the difference between inflows for 2015 amounted to $46 billion to November is only $3 billion more than the intake of $43 billion for the same period in 2016. Revenues lost monthly, since August, the first month that revenues would be affected by the lower tax payments is now running around $1.2 billion lower than in 2015, suggesting that the full impact for the current fiscal year will end up costing $9 billion instead of the $12.5 billion originally stated. The cost for a full year would be in the order of $14 billion.
According to Shaw, 251,000 persons would have benefit from the increased threshold. Revenues for Government of Jamaica fiscal operations to the end of November 2016 are $26 billion ahead of the similar period in 2015. For the current fiscal year, revenues are $13.8 billion ahead of forecast an amount that has already exceeded the amount forgone in income tax.
Tax break costing far less in year 1
January 3, 2017 by