Namibia Building Workers Pension Fund welcomes increase in income tax thresholds
By Michel Haoses.
The Namibia Building Workers Pension Fund (NBWPF) in a statement recently expressed optimism for the future as many in the construction sector will no longer pay income tax following the announcement of the increase in income tax threshold made during the 2024/25 budget speech.
The Minister of Finance Ipumbi Shiimi in his budget speech announced that the threshold for individual income tax has increased from N$50,000 to N$100,000.
Painters, electricians, steel fixers, bricklayers, tilers, plumbers, concrete workers, shutterers, scaffolders, joiners, carpenters, and welders whether they are semi-skilled or artisans will be exempted from income tax as long as their annual income remains below N$100,000 threshold.
The new construction sector minimum wages payable will be N$18,27 per hour for labourers and is expected to become effective at the end of April 2024, presuming it is published so in the Government Gazette, to become legally effective as well as a mandatory requirement for the construction sector.
Previously before the adjustments, the majority of the workers needed to pay income tax. The hourly threshold without considering overtime payments and bonuses of approximately N$26,04 now, the hourly threshold has effectively doubled.
Consequently resulting in higher disposable income for construction workers and will be able to counter the effects and pressure of inflation over the years.
Enwich Kazondu, executive principal officer, recognising the positive impact on our economy due to consumption and spending commended the government for the increase in the income tax threshold as this increases the purchasing power of those with low income, stimulating the economy.
He also encouraged workers to put more money into retirement savings further continuing. “It may well be worth it to consider an increase in contributions to their pension fund. Currently, the minimum contribution is 4% per month, which is also, matched by the employer. We need to look at how we change and increase this in the interest of our members,” he concluded.
