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FinMin announces final draft of “millionaires’ tax”

THE FINANCE Ministry has prepared the final draft of a revision to the Income Tax Act that would raise the tax burden on people with higher incomes, as promised in the government's programme manifesto.

Rather than raising the income tax rate for wealthy people from the current 19 percent tax rate, the draft calls for those with higher incomes to progressively lose the right to declare a basic amount of their income, currently Sk91,000, exempt from tax. Next year, the basic tax-exempt amount should go up to Sk95,616.

The latest draft provides that employees with gross annual salaries exceeding Sk1.06 million, or Sk88,500 per month, will be unable to declare any portion of their income tax-exempt.

The highest monthly income at which individuals will still be able to deduct the full tax-exempt amount will remain equivalent to 10-times the subsistence level, or about Sk56,000 a month.

Self-employed people with annual incomes exceeding Sk597,600 after expenses and insurance premiums are deducted will also pay more in income tax.

According to Finance Ministry adviser Richard Sulik, the revision should take effect next January, the SITA news wire wrote.

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