The tax-free threshold has been increased from $91 666 to $500 000, and the highest tax rate of 40 percent will now kick in on income from $15 million, up from $1 million.
The Ministry of Finance and Economic Development said due to high inflation and other macroeconomic changes, most workers now found themselves in the high tax bracket, which reduced their net incomes.
On the other hand, the review was intended to stimulate demand in the economy from the increased workers’ disposable income.
The government last reviewed pay-as-you-earn tax bands in January, but concessions granted then have since been eroded by inflation.
The new relief will be particularly welcomed by civil servants who were given a salary increment on both the US dollar and local currency components of their salaries last month, backdated to June.
The widened tax-free threshold means more take-home income for them across the board.-New Ziana