Jamaicans now taking home $1.5 million in tax free earnings

 

 

The Government of Jamaica is projecting spending of $1.3 trillion for fiscal year 2025/26. Meanwhile Pay as You Earn excludes those earning $1.5 million of less from income tax.

Minister of Finance and the Public Service,Fayval Williams, made the disclosure as she tabled the Estimates of Expenditure in the House of Representatives on Thursday (February 13).

The sum, which is about the same as the 2024/25 Budget, comprises recurrent expenditure of $1.197 trillion and capital expenditure of $62.595 billion.

Williams said that the Budget, which is the 10th laid by the current Administration, has grown from the $580 billion tabled and approved for fiscal year 2016/2017.

“This growth in our Budget over the 10 years demonstrates the underlying strength of the policies of this Government starting with the implementation of the shift away from direct, towards indirect taxation.

She said Jamaica’s national Budget continues firmly in the trillion-dollar range, having crossed that threshold for the first time in fiscal year 2022/23.

The strength of the Budget, she said, is despite the challenges of 2024/25, including drought, severe impact of Hurricane Beryl, Tropical Storm Raphael and rainfall across all 14 parishes during the month of November.

“The Jamaican economy did not become resilient overnight; the Jamaican economy has become resilient as a result of the people and the sound policies of the Government. These sound policies are the building blocks of this resilient foundation, that this Government continues to lay as we pivot to the higher and more inclusive gross domestic product (GDP)) growth that we envision,” the Minister added.

Details on allocations under the 2025/26 fiscal year expenditure will be provided during the Minister’s Budget presentation on March 11, 2025.

The Standing Finance Committee is scheduled to meet from March 6 to 7 at Gordon House to review the Estimates.
 
Reduction of debt service ratio

Meanwhile, after almost a decade of fiscal restructuring, Jamaica is on a path to achieving a debt-to-gross domestic product (GDP) ratio of below 70 per cent by the end of the 2024/25 fiscal year.

The Finance and the Public Service Minister, Fayval Williams, made the disclosure while addressing members of the diaspora during the recent ‘Let’s Connect with Ambassador Marks’ virtual discussion session.

“We have managed, as a country, to reduce our debt-to-GDP from the highest it got from 147 per cent. Now we are expected to close this fiscal year at the end of March 2025 at below 70 per cent.

Coming from 147 per cent to 70 per cent in less than a decade is a remarkable achievement,” the Minister said.

Jamaica’s transformation from debt restructuring to a model of fiscal stability makes it an attractive destination for investment.

Minister Williams noted that while the country’s credit rating is considered below investment grade, the outlook is positive.

“Jamaica is an example of economic stability and responsibility,” she noted.

“International institutions have looked on Jamaica, they have looked at our debt reduction, tax reform, our monetary stability and have publicly given us passing grades. It was only last year that the rating agencies, after doing their analysis on Jamaica, raised their ratings on us. [Currently] we are just below investment grade rating and, of course, we have our sights on [attaining] investment grade rating,” the Minister added.

Information source: Jamaica Information service

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