The minister of Finance, Vera Daves, stressed Monday in Luanda that a study on the review of Labour Income Tax (IRT) is underway, despite not having been recommended by the members of parliament.
Although it has been discussed in detail, the IRT is not part of the recommendations of the Joint Opinion Report submitted to the Government, after the approval of the 2023 General State Budget (OGE), with 124 votes in favour, 86 against and no abstentions.
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In terms of taxes, among the recommendations, it only included the draft law on the reduction of the Value Added Tax (VAT) from 7% to 5% for the entire production sector.
In this regard, Vera Daves informed that the reduction of VAT has an impact on revenue which provides less money to spend, which means that spending choices have to be made.
In the case of Value Added Tax (VAT), she said that the possibility of the recommended reduction is being analysed, after which the result of the study will be presented.
As regards the Labour Income Tax (IRT), which was analyzed in the special session on 2023 State Budget, discussed in the speciality session of the State Budget 2023, Vera Daves expressed her willingness to discuss the issue by revisiting models and presenting its impact study.
“We’ll do so continuously to ensure that the best balance is found between the revenues we intend to raise and the expenses we intend to make”, the Finance minister made it clear that she is listening to society’s concerns.
When it is time to implement a review of the IRT, the Ministry of Finance will also pronounce itself and justify why, a process that, according to her, will be done in a transparent way and with the best technical argumentation possible.
The current IRT income table is made up of 13 steps, with rates that vary from 10% to 25%, in its application the higher salaries with greater discounts and, in turn, lower salaries exempt from this tax.
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The IRT Code segments labour income into three taxation groups, where group A refers to remuneration paid by the employer to employees, including civil servants.
Group B covers remuneration paid to self-employed workers, as well as the income of managers and directors or members of corporate bodies of companies.
Group C includes all income received from industrial and commercial activities, which are supposed to be all those listed in the table of minimum profits in force.