Afif contradicting himself again
The MNA for Anse Etoile, Ahmed
Afif, who was once Principal Secretary
for Finance, could not let
the chance of scrutinizing the ministerial
nominees last week, to show how savvy
he is on financial and taxation issues.
Quizzing Dr Peter Larose - who has since been appointed Minister of Finance, Afif let out that he is against the new Progressive Income Tax System.
In the past, the opposition, notably the SNP has always advocated such a system and in fact when Government announced the new mechanism, it was quick to scream that “another of their ideas had been stolen”.
Yet, last Wednesday, Ahmed Afif told the National Assembly that the new tax laws would return the country to the old complicated system that the IMF had criticised at the start of the economic reform programme, which was in October 2008.
Afif said that: “The IMF said at the time that our tax system was too complicated and advocated a more equitable system by applying a flat rate of 15% across the board”.
Afif went on: “That made payroll easy and was a much fairer system.”
So that, according to Afif means that the low-income earners of just R5,000 per month should pay the same tax rate of 15% as those earning over R80,000 monthly.
In February this year, the Finance Ministry announced a new system to replace the old one - with a flat rate of 15% - which had been in force since 2010.
Under the new progressive tax system, no tax at all is applied on the first R8, 555.00 -whatever the salary.
A rate of 15% is applied on incomes of between R8555 and R10, 001. Incomes are then taxed progressively higher until R83, 333 monthly when tax is 30%.
However, the progressive tax system does not apply to expatriate workers.
Commenting on the new system, Finance Principal Secretary Patrick Payet said “it is a fair system as workers earning up to R35, 667 monthly will see an increase in the amount of money they take home, after their personal income tax has been deducted”.
Payet said that over 90% of Seychelles workforce will benefit under the new system.
Seychelles’ workforce is presently 46,000, of which 25% is expatriate labour.
Government stands to lose up to R 400 million yearly with the new tax system. Payet said Government plans to offset that by reviewing its process to make them more efficient. It shall also review the Business Tax and Customs Services to ensure the right tax rates are applied.
Independent
Quizzing Dr Peter Larose - who has since been appointed Minister of Finance, Afif let out that he is against the new Progressive Income Tax System.
In the past, the opposition, notably the SNP has always advocated such a system and in fact when Government announced the new mechanism, it was quick to scream that “another of their ideas had been stolen”.
Yet, last Wednesday, Ahmed Afif told the National Assembly that the new tax laws would return the country to the old complicated system that the IMF had criticised at the start of the economic reform programme, which was in October 2008.
Afif said that: “The IMF said at the time that our tax system was too complicated and advocated a more equitable system by applying a flat rate of 15% across the board”.
Afif went on: “That made payroll easy and was a much fairer system.”
So that, according to Afif means that the low-income earners of just R5,000 per month should pay the same tax rate of 15% as those earning over R80,000 monthly.
In February this year, the Finance Ministry announced a new system to replace the old one - with a flat rate of 15% - which had been in force since 2010.
Under the new progressive tax system, no tax at all is applied on the first R8, 555.00 -whatever the salary.
A rate of 15% is applied on incomes of between R8555 and R10, 001. Incomes are then taxed progressively higher until R83, 333 monthly when tax is 30%.
However, the progressive tax system does not apply to expatriate workers.
Commenting on the new system, Finance Principal Secretary Patrick Payet said “it is a fair system as workers earning up to R35, 667 monthly will see an increase in the amount of money they take home, after their personal income tax has been deducted”.
Payet said that over 90% of Seychelles workforce will benefit under the new system.
Seychelles’ workforce is presently 46,000, of which 25% is expatriate labour.
Government stands to lose up to R 400 million yearly with the new tax system. Payet said Government plans to offset that by reviewing its process to make them more efficient. It shall also review the Business Tax and Customs Services to ensure the right tax rates are applied.
Independent
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