Minister mute on PAYE
GOVERNMENT has maintained the exempt threshold for the Pay As You Earn (PAYE) starting at K3,300 per month despite calls from some stakeholders to adjust the tax as it is a strain on workers.
Among the stakeholders who were calling on Government to adjust PAYE bands were the Zambia Union for Financial and Allied Workers (ZUFIAW) and the Zambia Institute of Chartered Accounts (ZICA).
But Government, has maintained the bands introduced in the 2017 national budget as evidenced by the silence from the Minister of Finance, Mr Felix Mutati, who did not mention anything on the subject during his 2018 national budget presentation to Parliament yesterday.
Current income bands which have been maintained were zero percent between K0-K3, 300.00, 25 percent for bands between K3, 300.01-K4, 100.00, 30 percent for those between K4, 100.01-K6, 200.00 and 37.50 percent for workers above K6, 200.00.
Recently, ZUFIAW president, Ackim Mweemba, proposed that Government should reduce PAYE to 35 percent from the current 37.5 percent to give relief to the workers thereby increasing their disposable income.
“Workers deserve lower PAYE and other tax reliefs especially that the government is now getting substantial amount of money from toll gates and we should bring on board the untapped informal sector for it can immensely contribute revenue to the national treasury,” he said.
ZUFIAW, through Mr. Mweemba cautioned the Mr. Mutati that the danger of having high taxes might lead to Zambia failing to achieve the 2030 transformative sustainable development goals which were aimed at ending the tyranny of poverty in society.
And ZICA called on Government to consider granting tax relief to Zambian employees through reduction in PAYE tax rates and widening the tax bands for purposes of taxing income for salaried workers.
ZICA observed that Zambia’s salaried employees were presently the highest taxed persons in comparison to other countries in the region.
Mr. Mutati however proposed to introduce penalties in the Value Added Tax (VAT) Act, and Customs and Excise Act for taxpayers that failed to furnish records upon request and similarly for those who failed to issue tax invoices.
He also proposed to change the due dates for submission of the VAT returns from the 16th to the 18th of every month.