PROPOSED PAYE LOWER THAN IN SA

MBABANE – While there is uproar over the proposed PAYE increase for high income earners, comparisons made by this publication show that South Africans are paying even higher.

In his budget speech in the past month, Minister of Finance Neal Rijkenberg announced a proposal to lift the upper tax bracket from 33 per cent to 36 per cent, a move Members of Parliament (MPs) and other commentators have frowned upon.

Pockets

The minister said this would mean that 80 per cent of the taxpayers would be better off with more money in their pockets. Individuals to be most affected will be those who will have their pay-as-you-earn (PAYE) increased by more than E8 500 annually. These are individuals earning between E45 833.33 and E50 000 (E550 000 and E600 000) or more. They shall have their remuneration taxed at the 36 per cent, which shall amount to E179 800 and above per year. This will make the high income earners PAYE tax rate for Eswatini among the highest in the SACU region behind South Africa, where  those in the tax bracket E488 701– E641 400 currently pay  36 per cent of taxable income above E488 700.

In the neighbouring country, it is even worse for those earning  over E1.73 million, as they pay as high as 45 per cent of taxable income above E1 731 600. Eswatini is a member of the Southern African Customs Union (SACU) alongside Botswana, Lesotho, South Africa and Namibia. In Namibia and Lesotho, high income earners pay 30 per cent while recent data for Botswana was not immediately available. Meanwhile, this publication recently reported that others to be affected by Eswatini’s adjustment in PAYE for high income earners would be those earning between E41 666.66 and E45 833.33 (E500 000 and E550 000). They shall pay E7 000 more for their PAYE. These taxpayers are in the 36 per cent tax bracket and shall pay E161 800 annually.

Income

Income earners remunerated between E37 500 and E41 666.66 (E450 000 and E500 000) shall pay E143 800 annually. This shall be a four per cent hike which is equivalent to E5 500 from the E138 300. A three per cent increment shall also be effected on income earners remunerated between E33 333.33 and E37 500 (E400 000 and E450 000). This will hike their PAYE by E4 000 from E121 800 to E125 800. Also, individuals earning between E 29 166.66 and E33 333.33 (E350 000 and 400 000) shall pay E2 500 extra. This will be a two per cent increment given that they are currently paying E105 300 and it is set to increase to E107 800. On the other hand, income earners ranging between E25 000 and E29 166.66 (E300 000 to E350 000) will soon pay E89 800 instead of the current E88 800. This is a one per cent increment which is equivalent to E1 000.

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