BY JEFFREY ELAPA
THE TAX holiday enjoyed by many resource developers and companies will cease as of next year, giving more rooms for the Government to collect revenue.
The Custom Tariff (2019 Budget) (Amendment) Bill 2018 tabled in Parliament and other 2019 Budget amendment bills including excise tariff, goods and services tax and income tax were geared towards revenue collection of the Government.
Custom Tariff (2019 Budget) (Amendment) Bill 2018 proposes an amendment to increase tariff rates for a number of imported items.
It is intended to provide relief to local pioneer industry and existing local manufacturers from cheap imports. It will also enforces the tariff reduction programme, and proposes an amendment to introduce a new export tax of K15 per kilogram on sea cucumber.
The other bill is the Exercise Tariff (2019 Budget) Bill 2018.
It is a bill that proposes an amendment to suspend the five per cent monthly indexation applied to alcohol base rates, tobacco base rates and an amendment to remove several exercisable luxury good under “other goods” such as TV, playbox, microwaves, etc, that are now considered household needs.
The Good and Services Tax (2019 Budget) (Amendment) Bill 2018 proposes to remove the goods and services tax (GST) zero-rating status on supplies made to resource companies. All supplies made to mining, petroleum or gas companies will now be subject to the full 10 per cent GST rate.
Abel said the administration of this particular zero-rating provision was becoming too complex and was fraught with abuse.
It is intended to safeguard Government revenue and simplify tax administration.
It also tidies up incorrect legislative references in the refund provisions.
Abel said the Income Tax Amendment Bill gave greater powers to the Internal Revenue Commission to collect tax.
He said the Income Tax (Salary or Wages) (Rates) (2019 Budget) (Amendment) Bill 2018 proposed an amendment to reduce the personal income tax burden on low to middle-income earners by increasing the tax-free threshold to K12,500 and increasing the second threshold from K18,000 to K20,000.
Abel said the Income Tax, Dividend (Withholding) Tax and Interest (Withholding) Tax Rates (2019 Budget) Amendment Bill 2018 would increase personal income tax-free threshold from K10,000 to K12,500 and increase the 22 per cent marginal tax bracket threshold from K18,000 to K20,000.
All these bill are necessary to allow revenue collection to finance the 2019 Budget.
BY JEFFREY ELAPA