Tax
A number of legislation amendments were proposed for the 2003/04 fiscal year with a view to improving tax compliance and collection, closing loopholes and easing tax administration. The amendments will be made to the Income Tax and Transfer Duty legislation while a new law is proposed for the creation of a unified revenue service.
- The existing tax rates and thresholds for residents and non-residents to continue unchanged. Refer to the attached tax tables.
- Withholding tax imposed on rentals paid by all persons other than individuals and on interest received by residents. The withholding tax on rental income to be 10% and on interest income, 15%. However interest payments to individual’s upto P 500 per month or P 6 000 per annum to be exempt from such withholding tax deductions.
- Exemption withdrawn on payment of dividend without deduction of withholding tax to associated companies.
- The commissioner’s power to write off uncollectable taxes has been enhanced from P 5 000 to P 25 000 subject to certain formalities.
- Banks and financial institutions to be allowed a deduction of a prescribed percentage of non-performing assets for which provision has been made in the accounts.
- Directors of companies will be made jointly and severally liable for taxes due, for the years when they had been directors.
- Penalty for failure to file a tax return within a specified period is increased to P 2 000 from P 500.
- It is clarified that 3% withholding tax will not be applicable to construction related services provided such services are under separate contracts.
- Objections against assessments made to be entertained only on payment of all taxes on undisputed income.
- Proposal to waive the transfer duty of 5% where VAT is payable. Persons who have paid the VAT and transfer duty can apply for a refund of the transfer duty paid after 1st July 2002.
Tax Tables
Personal income tax resident individuals
Annual taxable Income |
Tax liability 2003-2004 |
Marginal rate % |
Average rate % |
|---|---|---|---|
25000 |
0 |
0 |
0 |
30000 |
250 |
5 |
0.83 |
35000 |
500 |
5 |
1.43 |
4000 |
750 |
5 |
1.88 |
43750 |
938 |
5 |
2.14 |
45000 |
1063 |
10 |
2.36 |
50000 |
1563 |
10 |
3.13 |
55000 |
2063 |
10 |
3.75 |
60000 |
2563 |
10 |
4.27 |
62500 |
2813 |
10 |
4.50 |
65000 |
3188 |
15 |
4.90 |
70000 |
3938 |
15 |
5.63 |
75000 |
4688 |
15 |
6.25 |
80000 |
5438 |
15 |
6.80 |
81250 |
5625 |
15 |
6.92 |
85000 |
6375 |
20 |
7.50 |
90000 |
7375 |
20 |
8.19 |
95000 |
8375 |
20 |
8.82 |
100000 |
9375 |
20 |
9.38 |
110000 |
11875 |
25 |
10.80 |
120000 |
14375 |
25 |
11.98 |
130000 |
16875 |
25 |
12.98 |
140000 |
19375 |
25 |
13.84 |
150000 |
21875 |
25 |
14.58 |
160000 |
24375 |
25 |
15.23 |
170000 |
26875 |
25 |
15.81 |
180000 |
29375 |
25 |
16.32 |
190000 |
31875 |
25 |
16.78 |
200000 |
34375 |
25 |
17.19 |
250000 |
46875 |
25 |
18.75 |
300000 |
59375 |
25 |
19.79 |
Resident individuals – tax summary
Annual taxable income |
Rate of tax |
|---|---|
0 to 43 750 |
5 % of every Pula |
43 751 to 62 500 |
2 188 + 10% of excess over 43 750 |
62 501 to 81 250 |
4 063 + 15% of excess over 62 500 |
62 501 to 81 250 |
2 813 + 15% of excess over 62 500 |
81 251 to 100 000 |
6 875 + 20% of excess over 81 250 |
Over 100 001 |
10 625 + 25% of excess over 100 000 |
Companies Normal
|
Manufacturing / IFSC
|
||
|---|---|---|---|
| Company tax | 15% |
Company tax | 5% |
| Additional company tax | 10% |
Additional company tax | 10% |
Capital gains tax Individuals
Annual taxable income |
Rate of tax |
|---|---|
0 to 10 000 |
0% |
10 001 to 35 000 |
0 + 5% of excess over 10 000 |
35 001 to 50 000 |
1 250 + 10% of excess over 35 000 |
50 001 to 65 000 |
2 750 + 15% of excess over 50 000 |
65 001 to 80 000 |
5 000 + 20% of excess over 65 000 |
Over 80 001 |
8 000 + 25% of excess over 80 000 |
Companies
| Company tax | 15% |
| Additional company tax | 10% |
Capital gains tax Individuals
Annual taxable income |
Rate of tax |
|---|---|
0 to 100 000 |
2% of every Pula |
100 001 to 300 000 |
2 000 + 3% of excess over 100 000 |
300 001 to 500 000 |
8 000 + 4% of excess over 300 000 |
Over 500 001 |
16 000 + 5% of excess over 500 000 |
| Companies: | 12.5%
of every Pula |
