The Seychelles’ Minister of Finance announced on Tuesday during the presentation of the 2018 budget to the National assembly that the third and final phase of the new income tax will be implemented on July 1, 2018.
The proposed budget of SCR 7,951 million ($586 million) had an increase of 0.4 per cent compared to 2017.
Forty percent of the budget will be spent on the Education, Health, Family Affairs and Social sectors, which shows the importance the government places on these matters.
According to Larose, there has been a big debate on the proposed progressive income tax but he believes that the new proposal will be simple and fair to all taxpayers.
There will be no tax applied on the first SCR 8,555.50 ($648) of a person’s salary.
A 15 per cent rate will apply to earning between SCR 8,555.50 ($648) and SCR 10,000 ($10,000).
A 20 per cent rate will apply to earning between SCR 10,001 ($758) and SCR 83,333 ($6,320).
A 30 per cent rate will effect salaries above SCR 83,333 ($6,320).
The minister said that the Seychelles Public Transport Corporation (SPTC) must become a self-financed entity because it will receive no funding. This will cause an increase of bus fares by SCR 2 ($0.14) bringing the new fare to SCR 7 ($0.51). However, this should be looked at a way to recover the capital invested in new buses as opposed to a load on commuters. The government will still subsidise travel for pensioners, schoolchildren and people on disability benefits.
The budget also focus on energy efficiency and it makes provisions for a DNA laboratory for the police department.
In 2018, it will be mandatory for bulbs, fridges and refrigerators, air conditioners, electric water heaters and washing machines, to meet minimum efficiency standards.
Reactions to the budget started on November 7.
