More money for workers

WORKERS earning K673 and below per fortnight will have more money in their pockets, Port Moresby Chamber of Commerce and Industry president Rio Fiocco says.
This came after the Government’s decision to raise the ceiling of wages and salaries for personal income tax, reducing taxes by K42 for workers.
“It is obvious to anyone who does their weekly shopping that prices of goods have gone up ranging from rice, ox and palm and the big one recently is the price of toilet paper,” Fiocco told The National.
“Basic commodities have gone up quite a bit recently and this obviously affects the spending or buying power of workers.
“It is a move welcomed by the workers and it means that they can buy at least or if not more goods at the shops.
“It’s a central move by Treasury to bring in this temporary relief in terms of reducing GST (Goods and Services Tax) on certain commodities as well as the increase of the tax-free threshold for workers’ salaries.”
All workers earning at least K673 per fortnight would have their tax bill reduced by K42 per fortnight effective yesterday, according to the Internal Revenue Commission.
Commissioner-general Sam Koim, in a public notice, said the Government recently passed an amendment to the tax, the Income Tax (SWT) (Rates) Act, temporarily increasing the SWT tax-free threshold form K12,500 to K17,500.
This would 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 of 22 toea for each kina was only paid after the annual income exceeds K17,500.
Putting this in fortnightly terms, all workers earning at least K673 per fortnight, would have their tax bill reduced by K42 per fortnight.
A further 20,000 workers with incomes between K480 per fortnight and K673 per fortnight would pay no income tax during this period.
People with incomes less than K480 per fortnight had already paid no income tax so their tax payments could not be reduced.
The tax-free threshold increase was effective only from Dec 31, 2022.
From Jan 1, 2023 onwards, the tax-free threshold would revert to K12,500.