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Sudhakar on Income tax: How Much You Save Now vs 2001

Sudhakar on Income tax: How Much You Save Now vs 2001
Opposition MP Salote Radrodro with Government Whip Ashneel Sudhakar on July 11, 2017. Photo: Arishma Devi-Narayan
July 12
13:13 2017

Practical examples of how the increase in the income tax threshold from $16,000 to $30,000 will benefit Fijians from all sectors was yesterday given in Parliament by Government Whip Ashneel Sudhakar.

The Ba lawyer delivered a power packed and to-the-point address and contrasted the increase with what people paid under the Soqosoqo Duavata ni Lewenivanua Party.

“In the case of the working couple or two people earning a salary in the same household, you are set to save up to a total of $3720. The Government has reserved about $25 million to foot your tax bill.

“In practical terms the Government is giving you a 42-inch flat screen television and a Blu Ray DVD player or a Samsung S8 smart phone every year as a Christmas gift.

“Yes Honourable Radrodo Christmas has indeed come earlier for the people of Fiji and we have to thank FijiFirst for that.”

The following comparisons were made by Government MP and Government Whip Ashneel Sudhakar:

The Opposition members of Parliament were not spared by Mr Sudhakar.

He reminded them that the increase in threshold which everyone of the Opposition Members, including National Federation Party leader Biman Prasad who said it was not beneficial, would also benefit them.

“Even the members of Parliament who are criticising tax reforms are set to gain some $1860 each. If you don’t like it give it back to us. As the saying goes ‘put your money where your mouth is’.

“Our Government is including everyone in the growth whether they are low salary earners or those on a higher scale. This does not mean that those in the informal sector won’t benefit.

“There will be more money in the pockets of people as a result of tax savings. This money will not stay in their pockets.

“They will share with those who sell vegetables and crabs on the roadside.

“They will buy cars providing work to the mechanics and the tyre repair boys.

“It will have a ripple effect which the opposition does not seem to understand,” he said.

Tax rates 2001

In 2001 when SDL was in power, only people earning below $6500 were exempt from income tax. In 2006 the tax threshold was slightly increased to $8840.

“Which meant that if you were a Police officer in 2001 earning $10,000 you would be paying $525 or 5 per cent of your income as income tax. If you were a nurse earning $15,000 you would be paying income tax of $1775 or 12 per cent of your income. If you were a school teacher earning $18,000, the income tax would be a whopping $2525 or 14 per cent of your salary.

“If by some fortune you were earning $40,000 you would be paying $9825 in taxes or 25 per cent of your income. A quarter of you income went in taxes. At $40,000 you are now required to pay just $1800. A saving of a massive $8025. If this is not a benefit then what is it?”

Edited by Ranoba Baoa

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