Accra, Feb. 5, GNA - The minimum income tax threshold is to be raised from 1.2 million cedis to 1.5 million cedis to reduce the tax burden on loyal citizens who honour their tax obligation.
Mr Yaw Osafo-Maafo, Minister of Finance and Economic Planning, who announced this in the Government's Budget Statement, presented to Parliament on Thursday explained that the implementation of the proposed measure would make the first 1.5 million cedis of individual's incomes tax-free instead of the current 1.2 million cedis.
He said the next 1.2 million cedis, which would be raised to 1.5 million cedis and shall attract a tax rate of 5 per cent. The Finance Minister, who described the statement as a "Business Friendly Budget', said the next three million cedis, however, would still be taxed at 10 per cent.
He said the next 21 million cedis would be taxed at 15 per cent adding that the next band of 24 million cedis would be expanded to 33 million cedis and taxed at the rate of 20 per cent. "Incomes exceeding 60 million cedis per annum instead of 48 million cedis will be taxed at 30 per cent," he said.
He stressed: "These tax relief are expected to increase the disposable incomes of Ghanaians and thus improve their standards of living.
"We also believe that this friendlier tax regime would encourage more people to honour their PAYE tax obligations and also reduce the incidence of tax avoidance and evasion."
