The Jamaican government has announced a raft of measures aimed at improving the socio-economic situation of Jamaicans, including increasing the income tax threshold will to two million dollars (One Jamaica dollar=US$0.008 cents) over a three-year period.
Finance Minister Fayval Williams in her first-ever budget presentation to Parliament on Tuesday night, said that the income tax measure would go into effect from April 1, this year, without indicating the cost of the initiative to the treasury.
She told legislators that the threshold would first rise to J$1.8 million, increasing slightly to J$1.9 million, and finally to two million dollars.
“Doing it this way means our hardworking taxpayers don’t have to guess year after year if the threshold is going to increase,” she said, in keeping with a trend set by the ruling Jamaica Labour Party (JLP) dating back to 2016.
The threshold was raised to J$1.7 million at the start of the current fiscal year in April, at a cost of nine billion dollars.
Williams also announced that in 2023, there were 652,220 individuals earning up to six million dollars annually and paying income tax.
The Finance Minister said that her “good news” budget contained a raft of incentives for consumers and businesses including a one billion dollar subsidy to assist the first 20,000 customers who sign up with Jamaica Public Service(JPS) for prepaid electricity; an 80 per cent cut in bond on duties for new car dealers; as well as longer repayment period on student loans.
She said that for the first time in a decade, based on fiscal rules, the Jamaica government could have run a deficit equivalent to “no more than 0.3 per cent of GDP (gross domestic product), and that would still keep us on the path to 60 per cent debt-to-GDP by fiscal year 2027/28”.
But she said Prime Minister Andrew Holness decided against doing so as it would send “a very bad signal to the world in an election year.
“We want to preserve the hard-won gains of the people of Jamaica and their children and grandchildren so they will not have to suck salt through wooden spoon again,” she said.
Williams also announced that the Tax Administration Jamaica (TAJ) will be introducing Saturday operations at select tax offices in every parish across the island in a move aimed at improving taxpayer convenience and boosting revenue collection.
“We will announce those dates, as those offices are open in every parish across Jamaica…. We should make it as easy as possible for Jamaicans to pay their taxes,” she said, noting that while approximately 80 per cent of revenues collected by the TAJ is from online services, the initiative is expected to provide taxpayers greater flexibility and accessibility to tax services.
“While we strongly encourage the use of our online access, we recognise that it takes time to transition some people to the online world. And so, I asked the commissioner of taxes to have a tax office opened in every parish on a Saturday to ease the congestion in the week to make it easier.”
“We are a Government that listens; we are a Government that cares and having a tax office that is open in every parish on a Saturday is good news,” Williams said.
The Finance Minister said that the subsidy to assist JPS consumers is part of wider efforts to combat theft and support low-income households.
“This one billion dollars will go towards paying for house wiring and inspection, helping those with illegal connections to get legally and safely connected to the JPS grid,” she said, describing it as “the most ambitious programme to allow affordable access to pre-paid electricity.
“We know that the cost of house wiring and inspection can be prohibitive for many people, and so, as a caring government, we are absorbing that cost in order to begin addressing this massive electricity theft problem.”
William told legislators that pre-paid electricity “will put legal electricity within reach for many.
“Because pre-paid electricity allows you to buy the amount of electricity you can afford when you can afford it, you have complete control. You will be able to buy the card or vouchers from hundreds of outlets across Jamaica, just like how you buy phone cards now. You may also be able to top up online. The technology will make it easy.”
Williams said in January this year, Energy Minister Daryl Vaz told Parliament that in 2023, “the electricity stolen amounted to a staggering J$40.385 billion. That works out to J$13,500 for every man, woman, and child in Jamaica.”
“I believe that on both sides of the aisle, we all want a solution because all of us who pay for electricity have this added burden on our monthly bills,” she said, noting that Opposition Spokesman on Energy Phillip Paulwell also shared the data.
“But it’s not just those of us who can afford post-paid electricity who bear this burden. More importantly, the people who steal electricity are in need of a solution because, for the majority of them, the cost of post-paid electricity is prohibitive relative to their earning capacity.”
The Finance Minister said pre-paid electricity is available to anyone, not just vulnerable communities or people with illegal connections, adding that the GCT on pre-paid electricity is seven per cent.
“This is an offer you cannot refuse,” she said.
Williams said that under the initiative, the first 20,000 new pre-paid customers will get J$4,000 credit for electricity per month for six months under the Government’s House Wiring and Inspection Programme that will be implemented by Jamaica Social Investment Fund (JSIF).
She said half of the J$4,000 credit will come from the JPS and the other half will come from the Government and that the JPS and JSIF will identify vulnerable communities and provide the sign-up procedures.
The JPS data shows average monthly bill for pre-paid customers is J$8,000 and that there are 17,000 customers currently using the pre-paid electricity meter.
KINGSTON, Jamaica, Mar 12, CMC –
CMC/ah/ir/2025