Pensioners can now have a sigh of relief after the National Assembly spared them from the proposed tax on their monthly payment.
In the report by the National Assembly Finance and National Planning Committee for the consideration of 2020, the Committee moved to assure the elderly of their full month stipend after uproar on the attempt tp shave the retiree’s life-line.
“The amendment is intended to retain the exemption for income of the National Social Security Fund (NSSF). The deletion of the amendment is intended to protect the benefits of members of the NSSF,” noted the Committee.
The reversal on the tax proposal comes after an uproar from both the pensioners and industry on the impact of the proposed tax on them.
In its submission to the parliamentary Committee, the NSSF urged that the proposed tax is a reversal on the b basic social security to the workers.
“Taxation of NSSF’s income will erode the benefit to its members and goes against government policy to provide social security,” the NSSF said.
The Tax Advisory firm KPMG also come to the retirees’ rescue, it urged that the proposed tax will be a hit to the elderly, the majority of whom hardly have alternative sources of income.
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In its analysis of the Finance Bill, KPMG noted that the proposal will reduce the retirement benefits available to retirees and is also contrary to the general provisions of the income of the registered retirement schemes.
The tax proposal was earlier contained in the April’s Tax Laws Bill b before it was taken out by the Parliament based on reduced income payable to pensioners.
The rejection by the House Committee was ironically supported by the National Treasury urging that the submissions to the Committee that taxing the pensions would have been devastating to the elderly.
