Government is mulling lifting the income tax threshold and increasing the daily minimum wage but a decision would be based on the current analyses that are being undertaken by finance personnel, President Irfaan Ali yesterday announced.
“I am currently reevaluating our revenues; projected revenues; the economy based on its strength, to analyse a further adjustment in the minimum wage,” the President announced yesterday at a press conference held at State House.
“Also, reviewing the absorptive capacity at further advancing liquidity in your pockets, if I may put it that way, by an adjustment in the tax threshold. This is another issue that I would say is on the front burner of consideration. We are analysing the numbers and ensuring that whatever we come up with is in keeping with the sustainability of our economy,” he also said.
He would not go into details whether the measures, if taken, would be implemented at some point this year or if it was an assessment to cater for the 2024 budget. “We are looking at the numbers. That is as far as I would go,” he responded when probed.
Following pressure from trade unions and civil society, the $60,000 National Minimum Wage Order was last year June signed by Labour Minister, Joseph Hamilton, and gazetted.
According to the Order which took effect from July 1, 2022, private sector employees should not be paid less than $60,147 per month. The change in the national minimum wage came approximately five years after the last one, which took effect on January 1, 2017. At that time the rate moved from $34,500 to $44,200.
The hike in the minimum wage benefitted close to 10 per cent of private sector employees. The issue had come in for more scrutiny of late in light of the rising cost of living, including higher food prices.
And as it pertains to the income tax threshold, government had in January announced that the income tax threshold would be raised from $75,000 per month to $85,000 per month.
The income tax threshold had been increased in the 2022 budget from $65,000 per month to $75,000 per month.
