Jamaican Government brings major overhaul to tax code

The House of Representatives announced on Tuesday that the personal income tax threshold will increase to $1.7 million, and a reverse tax credit for every Jamaican earning less than $3 million a year.

The Minister of Finance, Dr Nigel Clarke, shared several points of interest at the House of Representatives Budgetary debate held yesterday. The discussion suggested a strong economic position for the nation and a projected upward trajectory, for this reason, they have been able to bring about several changes to the tax code.

The changes include a higher bar to the income tax threshold, the introduction of a reverse tax credit of $20,000, the remover of the prerequisite of a guarantor for student loans, and the allotment of $2.3 billion for the construction of a full-service, eight-story tax office and business centre in Cross Roads, St Andrew.

The government has also announced that it will be launching a new unemployment insurance scheme, with Clarke stating “I am happy to report that macroeconomic stability makes it feasible to have an unemployment insurance scheme that benefits Jamaican workers.”

Employees would be registered and included in the scheme, and those who contribute to the scheme will automatically be included on the loss of a job confirmed by both employee and employer, what they will receive would be a percentage of their previously received weekly income up to a maximum threshold to a certain period of time.

While the parameters of the unemployment benefits are yet to be determined, Clarke gave reference to the schemes in the Bahamas and Barbados, before saying that the nation will have to work out what works for them specifically.

The session seemed to signify back-to-back good news for the general public, at least guaranteed benefits for the short term. Clarke goes on to emphasize the good news by stating “Let me assure you that we will positively impact the daily experience of Jamaicans with public investment expenditure designed to solve pain points… the public investment program will deliver well over $1 trillion of infrastructure expenditure over the next five years Inclusive of this year.”

Clarke also very gladly informed the public, that for the seventh year in a row, Jamaicans will not be introduced with any new taxes.