Some of the major 2016 budget measures announced yesterday by Minister of Finance Winston Jordan.
- The removal of excise tax on motor vehicles under four years old under 1500cc. These vehicles currently attract excise tax at the rate of 30% and an effective tax rate of 118.7%. With this removal, the effective tax rate will be reduced to 68.2%.
- The reduction of excise tax from 50% to 10% on motor vehicles under four years old, between 1500cc and under 2000cc. As a result, the effective tax rate of 152.3% will be reduced to 85%.
- The restriction of the importation of used and/or re-conditioned vehicles to under 8 years old from the date of manufacture to the date of importation. This restriction shall be enforced from May 1, 2016.
- Notice of intent to ban the importation of used tyres and to reduce taxes on new tyres to encourage their use. This ban will be put into effect as soon as some procedural hurdles are cleared.
- Amendment to the Value Added Tax law to:
- exempt par-boiled rice;
- packaging materials;
- other malt extracts other than
Ovaltine;
- Amendment to Income Tax Act to:
Provide for the income earned by Artistes during festivities certified by the Minister responsible for tourism to be exempted from the payment of income tax.
- Increase in Old Age Pension from $17,000 to $18,200, which is expected to benefit nearly 50,000 pensioners are expected to benefit, and increase in Public Assistance from $6,500 to $7,300, which is expected to benefit over 9,600 persons. Both measures are effective as of April 1, 2016.
- The reduction of the price of fuel sold by the Guyana Oil Company (GuyOil), with gasoline being reduced from $190 per litre to $170, dieseline from $161 to $150, and kerosene from $120 to $90,with effect from February 1, 2016,
- An increase in the rebate granted by the Guyana Power and Light Company from 10% to 15%, with effect from April 1, 2016, as a further measure to boost incomes of households and to stimulate the manufacturing sector.
- The Income Tax Act is to be amended to increase the income tax threshold to $660,000, from $600,000. With this measure, over 68,000 workers will be removed from the income tax roll.
