Pruaitch clarifies housing tax confusion


TREASURER Patrick Pruaitch says there has been a misunderstanding on taxation of employee-provided housing in next year’s budget that has led to public confusion and controversy.
“The 2017 budget only extended taxes that have been implemented since 2011 to include two new categories that encompass very high housing rentals,” he said.
“Corporate executives with employer-provided accommodation where weekly rentals range from K3001 to K5000 and those in properties rented for K5001 or more will pay higher taxes – depending on their marginal rates of tax.”
Pruaitch said the budget did not introduce changes for other workers who had employer-provided accommodation.
“I believe this has been clear to groups that I addressed after the budget was introduced in parliament,” he said.
“This change will only affect high-income earners who are provided with expensive accommodation and it will raise around K6 million annually.”
Pruaitch said the taxes introduced a greater level of fairness because employees who received housing allowances in cash were fully taxed at their marginal rates while those with employee-provided housing received concessional treatment.

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