Tax-cut converts into take-home pay rise
17 September 2010 |
September 17, 2010 -- Government's decision to bring down income tax rate to 15% will result in a rise in the take-home pay of all Seychellois employees as from October 1.
The tax cut is a benefit from recent economic, the Vice-President and Minister for Finance, Mr Danny Faure, said during a presentation on the new income tax rate at the Seychelles Trading Company's conference room in Victoria yesterday.
Mr Faure said that as a result of the reform programme, the economy is now on track and Seychelles is anticipating growth equivalent to 4% of the gross domestic product (GDP).
"When we started the economic reform programme we told the people of Seychelles that it was going to be tough but later there would be prosperity," explained VP Faure.
He reminded the audience at the presentation that the government also told the people that as the economy gets better they will see the result and benefit from it.
On July 1, the income tax rate introduced was R18.75%. Government collected R56.4 million rupees in contributions.
VP Faure said the budget is well on track; "When we started, we said we would achieve 7% of primary surplus. I am happy to see that the target has been met in July this year and the primary surplus exceeds 8%."
The fiscal space is allowing government to put forward a supplementary appropriation before the National Assembly asking for approval to spend R77.9 million to cover for other programmes between now and December, the VP announced.
As from January 2011, the income tax for non-SeychelloisÂ will increase to 15%, from the present 10%.
There will be a goods and services tax increase from 10% to 12% for Tourism Incentive Act certificate holders as of November 1 this year. The present Goods and Services Tax (GST) will be replaced by the value added tax in January 2012.