Although rates of income tax for employees have decreased, so have deductions and exemptions, meaning that ultimately the taxpayer will pay more than before.
Monday, December 3, 2012
Prensalibre.com reports that "the rates still in effect in 2012 are those of 15%, 20%, 25% and 31%, which will be charged up to 2012, and the new rates in 2013 are 5% and 7%. "
"Medical expenses and certain insurance or pension funds can no longer be deducted. Moreover, even if the worker has the right to file a return of value added tax (VAT) to reduce payment of income tax, this will not have the same affect, because it is no longer taken as a direct reduction of the tax but as a deductible expense. Starting in 2013, family expenses can not be included only personal ones. "
"If the taxpayer has more than one job, he must report to the employer who gives the greatest income, and what he gets in his second job."
"For employers it is now a requirement to withhold income tax from the employee, according to projected annual income, which must be from the employee’s income and deducting only the minimum wage (Q48 thousand), contributions to IGSS, IPM and assistance fund. Otherwise for the employer paying wages will not be recognized as a deductible expense. "
In the discussion taking place in Guatemala on differentiated wages, voices are being heard, speaking from the comfort of their desks, framing the issue as an all or nothing situation.
EDITORIAL
Juan Carlos Tefel, Director of the Board of the CIG and General Manager at Fogel, discusses with entreprenureal pragmatism but also social sensitibility the issue of the definition of differentiated salaries for some Guatemalan communities that have "a high rate of unemployment and 'real' income well below the minimum wage. "
For fiscal year 2013, gross wages subject to the payment of income tax are those exceeding 714,000 colones per month ($1,434 at today's exchange rate).
Between ¢714,000 ($1,434) a month and ¢1.071 million ($2,151) will incur tax of 10%. If the amount exceeds ¢1.071 million ($2,151), an additional tax of 15% will be paid on the excess.
Employees with annual revenues exceeding $11,000 can deduct from their income tax payments medical bills and interest payments on non preferential mortgages.
Declarations for extra expenses for consumption of medicines and health services and the payment of interest on a mortgage loan, other than preferred ones, on a main residence within the Republic of Panama, will result in "...
The bill provides that no amounts may be deducted from VAT on purchases, and increases the tax base for the payment of income tax.
The Guatemalan government’s tax reform law is ready, and contains several new points: employees ability to deduct VAT from annual purchases from their taxes has been eliminated, the tax base has been increased, and the road tax for vehicles has been doubled.
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