The Minister of Finance and Development Planning, Dr. Rets’elisitsoe Matlanyane, has officially corrected a typographical error in the recently presented budget speech. On Thursday, while addressing the National Assembly, Dr. Matlanyane stood on a point of order to rectify an error in paragraph 49 of her speech regarding the income tax rate.
According to the minister, the document had erroneously stated that the income tax rate was 35 percent, whereas the correct figure is 30 percent. The correction comes after widespread confusion among taxpayers, particularly civil servants, who had raised concerns that the mistakenly reported tax increase would negatively impact their earnings.
In response, Deputy Speaker of the National Assembly, Mrs. Ts’epang Mosena, advised Dr. Matlanyane to ensure the rectification was also communicated to the relevant parliamentary committee. She emphasized the importance of making the correction official for record-keeping purposes, including in the Hansard.
The error had sparked concern among salaried workers, especially civil servants, who had recently received a 2 percent salary increase. Many had feared that with the incorrect tax rate of 35 percent, their earnings would effectively decrease by 3 percent instead of increasing.
In her budget speech, Dr. Matlanyane outlined key tax reforms aimed at easing the financial burden on low-income earners. She announced that the government would raise the minimum threshold for income tax to M6,170.00, with a 20 percent tax rate applied to earnings within this bracket. For those earning above M6,170.00, the applicable tax rate is 30 percent.
Additionally, the minister revealed an increase in the monthly tax credit for individual income earners from M920.00 to M970.00. This adjustment is expected to provide some relief to workers amid the current economic challenges.
With the clarification now made, taxpayers can rest assured that the income tax rate remains at 30 percent, preventing unnecessary panic and ensuring accurate financial planning moving forward.
