INCOME TAX EASE?

By Linda Straker

Prime Minister Dr. Keith Mitchell has indicated that Government will be reducing the income tax threshold to EC$36 000 per year as part of a homegrown structural adjustment programme that is expected to get the approval of the International Monetary Fund (IMF) and other donors.

However, the Prime Minister has given assurances that the poor and marginalised will not be impacted.

“Whatever happens, the majority of people will still not be paying taxes because most people are not earning EC$3 000 a month,” Dr. Mitchell told a meeting held in the community of St. John’s last week.

At present, income tax is 30 per cent on earnings above EC$5 000 per month.

The 2014 Budget will be delivered in early December and it is expected that the new threshold will officially be announced at that time.

He also said that Grenada is expecting about US$300 million in debt relief as a result of the debt restructuring programme being designed.

“If we get that arrangement settled, and we do what we are expected to do, we could get as much as US$300 million of debt relief over a period of time,” Dr. Mitchell said.

He told the meeting that as a country, sacrifices will have to be made by nationals, indicating that everyone will have to pay their fair share of taxes. The Prime Minister is projecting major economic development for the country as a result of the restructuring programme.

“The monies we are getting could help people invest in more Small Business Enterprises, could help develop more educational activities for our children – more scholarships and training to prepare them to take the jobs that’s coming; could be put to health care, so that when you go to the hospital, you can get modern-day treatment,” he said.

He further explained that the money through the programme will also be able to help expand Agricultural activities by investing in technology and improving production levels, and giving farmers more power to earn more money.

While admitting that Grenada needs the backing of the IMF, any programme finalised will not be one prescribed by IMF.

“It is a Grenada programme supported by the IMF, let’s get it straight. IMF is not running Grenada; we are running Grenada, Carriacou and Petite Martinique,” he said.