24/01/2024
Removing a tax rebate is effectively an increase in tax paid by the taxpayer. If you remove tax rebates or tax concessions, you are increasing taxes on the person who previously benefitted from the rebates.
The dependents rebate was removed in November. The govt should pass legislation reversing the removal of the dependents rebate. The dependents rebates helps families with children. This is much needed now when costs of living are increasing g for working families.
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Let me explain this in Layman terms so that you may understand it properly. Let's say Joe Blow is earning K120,000 per annum. The increase of Tax threshold from K17500 to K20,000 means that Joe Blow will not be taxed on the K20,000 on his annual Salary. This means out of the K120,000, Joe Blow will be taxed on K100,000 only (K120,000 - K20,000 = K100,000)
How much is Joe Blow Paying as tax per Annum? 100,000 x 0.42 = K42,000 per year.
Tax rebate on Wages and Salaries is a claimable tax and this is called Wages and Salary Tax rebate. Tax rebate is calculated depending on how the number of dependant Joe Blow has. The more dependant Joe Blow has the more Tax that will decrease form his Salary. When PMJM is removing tax rebate, this wages and Salaries won't be claim and tax for people earning more than 20,000 will pay more tax. I feel for PNG. For country like USA, Tax rebate like a coffee season form them, that is when they get alot of money back from their wages and Salaries. We don't have the knowledge and we not even claiming our rebates too. PNG still lack the knowledge to claim their tax and so Government is removing tax rebate.
As a citizen of this beautiful nation I feel for my kids future, I really don't know where we are heading to