Govt raises tax threshold

ALL workers earning at least K673 per fortnight will have their tax bills reduced by K42 per fortnight effective tomorrow, according to the Internal Revenue Commission (IRC).
Commissioner-general Sam Koim, in a public notice, said the Government recently passed an amendment to the Income Tax (Salary or Wages Tax) (Rates) Act, temporarily increasing the salary and wages tax (SWT) tax-free threshold from K12,500 to K17,500.
This will remove the requirement for workers earning above K12,500 per year to pay 22 toea for each kina above K12,500 but below K17,500.
The new threshold means that the tax of 22t for each kina is only paid after the annual income exceeds K17,500. Putting this in fortnightly terms, all workers earning at least K673 per fortnight will have their tax bill reduced by K42 per fortnight.
The measure is expected to benefit over 200,000 workers by this benefit of K42 per fortnight.
A further 20,000 workers with incomes between K480 per fortnight and K673 per fortnight will pay no income tax during this period.
People on incomes of less than K480 per fortnight already pay no income tax so their tax payments cannot be reduced.
The tax-free threshold increase is effective only from tomorrow to Dec 31, 2022.
From Jan 1, 2023, onwards, the tax-free threshold will revert to K12,500.