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JUNE 2020 – TANZANIA

BUDGET SPEECH 2020/2021 & TAX CHANGES

It is important that employers note the following:

Tanzania Budget Speech Highlights & Tax Changes

The 2020/2021 Budget Statement was delivered by the Minister of Finance and Economic Planning, Hon. Dr. Philip Mpango, on 11 June 2020.

Economic Highlights:

  • Real GDP growth rate for 2020 will decline from the initial projection of 6.9% to 5.5%, mostly due to the COVID-19 pandemic.
  • Domestic revenue increased by 8.2% to 6.8 trillion shillings for the period January to April 2020, compared to 6.3 trillion shillings during the same period in 2019.
  • TZS 34.88 trillion was allocated in the budget to development expenditure.
  • Total national debt reached 55.43 trillion shillings at end April.
  • Inflation remains stable at a single digit between 3.0 and 5.0% in 2020/21.

Tax Measures:

  • Proposed amendments to the VAT Act to exempt agricultural crop insurance and allow exporters of raw products to claim input VAT on their purchases.
  • Increase of the minimum threshold of primary cooperatives societies liable to income tax from TSZ 50,000,000 to TSZ 100,000,000 per annum.
  • 100% allowable deduction for contributions made to the AIDS Trust Fund, as well as  contributions made to the Government for fighting against the COVID-19 pandemic until the Government announces the end of the pandemic.
  • Amendments to the Income Tax Act to increase the minimum threshold of employment income not liable to tax from TSZ 170,000 per month to TSZ 270,000 per month and adjustment of the income brackets accordingly.

The new tax rates, effective 1 July 2020:

Contact our legislation team at info@crs.co.za if you require any additional information.
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RS Technologies (Pty)Ltd. All Rights Reserved.

JUNE 2020 – MAURITIUS

BUDGET SPEECH 2020/2021 & TAX CHANGES

It is important that employers note the following:

Mauritius Budget Speech Highlights

The 2020/2021 Budget Statement was delivered by the Minister of Finance, Economic Planning and Development, Dr the Hon Renganaden Padayachy on Thursday 4 June 2020.

Economic Highlights:

  • As a result of the Coronavirus pandemic, the government’s debt is expected to jump significantly from a forecast of 61.6% to 83.4% of GDP.
  • In addition, the following is expected:
    • An economic recession of -5.8% of GDP;
    • Unemployment at 17%, an increase of 153.7%.
  • The budget deficit, which has evolved in a stable range of 3 to 3.5% of GDP since 2013, is estimated to explode to 13.6% in 2020, largely due to the COVID-19 crisis.
  • In regard to the outlook for 2020-2021, total revenue will amount to Rs 162.9 billion and total expenditure will amount to Rs 162.9 billion.
  • The Development Bank of Mauritius will invest Rs 10 billion in the SME (small medium enterprise) sector and cooperative societies, with a maximum of Rs 10 million per enterprise to sustain small and medium firms at a concessional rate of 0.5% per annum.
  • Rs 20 billion will be injected to support small and medium-sized enterprises and vulnerable households.
  • Government has earmarked Rs 15 billion to provide an exceptional minimum monthly support of Rs 5,100 to each beneficiary faced with unemployment.
  • The Private Pensions Scheme Act will be amended to:
    • Allow for a member of a private pension scheme to transfer the amount of accrued benefits to another private pension scheme; and
    • Establish a procedure for unclaimed funds under a private pension scheme to be transferred to a special fund to be set up by the Financial Services Commission.Tax measures:
      • As from 1 July 2020, the solidarity levy rate for Mauritian citizens will increase from 5% to 25% on their annual chargeable income, plus dividends, in excess of Rs 3 million instead of Rs 3.5 million. The levy will be payable under the PAYE system.
      • As from 1 September 2020, the National Pension Fund will be abolished and replaced by a new system, the Contribution Sociale Généralisée (CSG), a progressive contribution system ranging from:
        • 1.5% on a monthly salary of up to Rs 50,000;
        • 3% on a monthly salary over Rs 50,000.
      • An income tax holiday of eight years will be granted to a company manufacturing:
        • Nutraceutical products with operations starting on or after 4 June 2020; and
        • Pharmaceutical products, medical devices or high-tech products with operations starting on or after 8 June 2017.
      • The end-of-year bonus to employees earning up to Rs 100,000 monthly is secured under the Worker’s Rights Act.
      • No changes to personal income tax rates were announced.
      • Income exemption thresholds:
        • As from 1 July 2020, the income exemption thresholds will be increased by amounts ranging from Rs 15,000 to Rs 80,000.

      A taxpayer who has a bedridden next of kin as a dependent will be allowed to claim an additional annual deduction in the range of Rs 80,000 to Rs 110,000, provided that the total number of dependents does not exceed four.

Contact our legislation team at info@crs.co.za if you require any additional information.
© 2020 C
RS Technologies (Pty)Ltd. All Rights Reserved.

MAY 2020 – EGYPT

TAX CHANGES EFFECTIVE 1 JULY 2020

It is important that employers note the following:

Changes to Income Tax Rates and Personal Reliefs

On 7 May 2020 the Egyptian Government issued Law no. 26 of 2020, amending certain provisions of the Income Tax Law No. 91 of 2005 as follows:

  • Article (8) of the law regarding the income tax rates applicable to natural persons (individuals)
  • Article (13) of the law regarding the annual personal income exemption
  • Article (87 Bis) of the law regarding the penalties applicable on the tax return differences.

In addition to the new progressive rates, the law increases the annual personal exemption from EGP 7,000 to EGP 9,000 and abolishes the discount on the highest income bracket of a taxpayer (85%, 45%, 7.5%, 0%).

The law also introduces new penalty provisions where the final tax liability exceeds the amount declared. If the difference is less than 50%, a 20% penalty applies, and if the difference is 50% or greater, a 40% penalty applies. A 40% penalty also applies if no return is submitted. In the event an agreement is reached between a taxpayer and the tax authority without initiating appeal procedures, these penalties may be reduced by half

The annual taxable income should be approximated to the nearest lower EGP 10.

Tax rates, effective 1 July 2020.

Contact our legislation team at info@crs.co.za if you require any additional information.
© 2020 C
RS Technologies (Pty)Ltd. All Rights Reserved.

2018/19 Budget Speech Highlights and Tax Changes
Following the Budget Speech of May 2018, delivered by the Minister of Finance, Economic Planning and
Development, Goodall Gondwe, the following Income Tax measures will be effective 1 July 2018:

  • The tax-free income bracket under Pay-As-You-Earn (PAYE) will be increased from MK30,000 to
    MK35,000 per month.

Other Highlights of the Budget Speech:

  • A real GDP growth rate of 4.1% in 2018 and 6.0 % in 2019.
  • An average inflation of around 7%
  • The budget (total Expenditure and Net Lending) has been set at K1,504 billion which is 28.2% of GDP
  • The budgetary deficit is expected to amount to K242 billion which is 4.5% of GDP.
  • The 2018/19 budget includes ambitious youth programmes that are primarily intended to reduce Youth
    unemployment. It is for college graduates and non-graduates and has included projects which are
    targeting the youth.
  • In the 2015/2016 Budget, the Taxation Act was amended to introduce a provision on “Deemed Interest”
    where no interest is charged on a loan, and subject such deemed interest income to taxation. However,
    due to implementation challenges, Section 27 of Part III of the Taxation Act will be amended to provide
    clarity on the targeted taxpayers under this provision and bring fairness on the treatment of domestic
    and foreign loans which attract no interest.
  • The Taxation Act will be amended to introduce a requirement for the registration of salaried employees
    and issuance of Taxpayer Identification Number (TPIN) by MRA.
  • Section 39 (e) and (d) of the Taxation Act will be amended to introduce a MK5 million cap on the
    allowable deductions for individuals’ donations made to Charitable Organisations and Non-Profit
    Institutions approved by the Minister.

Contact our legislation team at info@crs.co.za if you require any additional information.

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