PEA happy with tax review

PUBLIC Employees Association (PEA) acting president Anna Igo says the association is pleased the government will address the 30% tax on the terminal benefits of retiring public servants.
Treasury Minister Don Polye had announced a taxation review last week when he delivered the 2013 Budget in parliament.
Igo said the tax review was long overdue as the last one was done almost 20 years ago.
“PEA had been knocking on the doors of the state for the last  10 years but we have been given the run around by the department of personnel management,” she said.
“Tax reductions on wages and terminal benefits have been high on our agenda in our log of claims but they have been brushed aside.”
She said public service workers had wage increases frozen in the 1990s under public sector reform adjustment programmes.
As a result, their wages remained stagnant while tax continued to rise affecting the take-home pay for public servants.
The increased cost of goods and services forced public servants to seek loans.
Igo said public servants and the general workforce had sacrificed a lot to drive development in the country through the government taxation policy.
She said when they were retrenched almost half of their entitlements were paid to the state.
She said these were people leaving formal employment and they needed the money to venture into tangible activities to sustain their life.
Any increase in wages in the public sector was consumed by the tax.
Igo said it was unfair when tax exemptions were accorded to multi-national companies who came into the country to invest, make huge profits and then leave.
She said if the government was serious in empowering economic prosperity, it must lower taxes on personal incomes.