Good News for Teachers as Govt Makes Major Changes to Their Salaries

President William Ruto has defended the Affordable Housing Levy, telling teachers on Thursday, November 12, that proposed Pay As You Earn (PAYE) tax cuts would leave a teacher earning Ksh50,000 with an extra Ksh1,250 in monthly take-home pay even after housing levy deductions.

Ruto spoke at the official opening of the Kenya Comprehensive School Heads Association (KECSHA) meeting in Mombasa.

He said the government plans to raise the monthly income exempted from PAYE from Ksh24,000 to Ksh32,000, so that workers pay no PAYE on the first Ksh32,000 they earn.

He explained that the extra Ksh8,000 in tax-free income would save workers in the 25 per cent tax bracket Ksh2,000 every month.

Using a teacher on Ksh50,000 as an example, he said the employee pays Ksh750 towards the 1.5 per cent Housing Levy, but gets back Ksh2,000 through the lower PAYE, leaving a net gain of Ksh1,250.

The proposal is part of a wider tax relief plan that would lift the tax-free income threshold to Ksh32,333 while scrapping the existing Ksh2,400 personal relief.

Employees would continue contributing 1.5 per cent of their gross salaries to the Affordable Housing Programme, so the PAYE cut would ease the burden without removing the levy.

The president also took a swipe at his political rivals, saying they were sponsoring a debate on protecting the payslip while his administration was proposing to remove PAYE on the first Ksh32,000 of earnings.

Ruto further defended the housing programme, saying it has created jobs for about 1.1 million people and supported the building of homes, markets and student accommodation.

He added that contracts for houses, markets and student hostels have reached Ksh1.2 trillion, with hostels for more than 180,000 learners under construction countrywide.

Source; https://www.facebook.com/share/p/19dhE6jMY8/

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