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Shaw says tax relief coming for higher-level earners too

Published:Friday | March 11, 2016 | 3:56 PM
Shaw: "Even as we want to start with those earning below $1.5 million, we know that those earning above $1.5 million and onwards to $5 million are also stressed."

Finance Minister, Audley Shaw, says tax relief is also coming for people who earn salaries between $1.5 million and $5 million annually. 

"Even as we want to start with those earning below $1.5 million, we know that those earning above $1.5 million and onwards to $5 million are also stressed, and we are going to be dealing with them as well," Shaw was quoted as saying today in a report from the Jamaica Information Service.

The report did not indicate the extent of the tax relief being considered.

As one of its election commitments, the Jamaica Labour Party (JLP) promised to remove income tax from the salaries of people earning up to $1.5 million annually. 

People who benefit could take home up to $18,000 more as of April when the plan is expected to come on stream. 

The current threshold of  $592,800 will continue to be applied to the salaries of people who earn between $1.5 million and $5 million.  

The plan has received divisive feedback with some critics including the former finance minister, Peter Phillips, saying the plan is unworkable and could be administratively difficult to implement.  

There is also a raging debate over whether the plan will result in a $32 billion shortfall or a shortfall just under $20 billion. 

Shaw, who is doing his second stint as finance minister, says he expects the upcoming tax plan will result in a happier and more productive workforce in the public and private sector sectors.

To fund the tax plan, the JLP administration plans to reallocate revenue from the gas tax, improved collection on tax arrears, and additional general consumption tax from increased spending.